All tyre manufacturing facilities have stopped functioning and the industry now expects to resume operations only by mid-April. " We have estimated the loss assuming things will get better from August,’’ said Rajiv Budhraja, director general of Automotive Tyre Manufacturer’s Association.
The expected financial impact of the above is not ascertainable at this stage and the duration of this shutdown will depend upon directives to be further issued by the respective government authorities in this regard, said Apollo Tyres.
Gurugram-based Apollo Tyres Friday said it’s leadership team has announced a voluntary reduction in pay due to the impact of COVID-19 on the automotive industry.
The company is investing USD 400 million on its first manufacturing plant at Sanand in Gujarat, where it is working to hike output to 60,000 units of two-wheeler tyres per day from the current 20,000 units a day, as part of the project's phase I expansion.
The Board of Directors of Apollo Tyres today approved an issuance of compulsorily convertible preference shares in the company worth Rs 10,800 million (approximately US$150 million) to an affiliate of Warburg Pincus, a leading global private equity firm focused on growth investing. The investment represents a primary capital infusion into the company and is subject to shareholder and regulatory approvals.
The latest technology combines the best of traditional electroplating, and new age requirement for environmentally safe and compliant ‘black’ colour, said the company, adding that the premium electroplating process guarantees a rich, lustrous, silky smooth chrome-plated blackness.
Already sitting on a debt of Rs 5000 crore, the company has decided to defer Rs 675 crore investment by a year in Cavendish Industries (a firm it acquired in 2016 from B K Birla Group) to ensure lean operations. With series of cost cutting initiatives and expected improvement in capacity utilisation, the company’s CFO Sanjeev Aggarwal said J K Tyre is planning to pare its debt to more than half in the coming three years.
The new range, priced from Rs 5,090, would be available at the company's authorised dealers across the nation in 30 sizes (12-16 inch) from early next year.
What will lend an impetus to the auto and tyre sectors is Finance Minister’s proposal to invest Rs 100 lakh crore in the infrastructure sector over next five years.
The company plans to start with 2000 tyres a day and scale it up to 5000 tyres gradually.
The domestic tyre industry has benefited from strong growth in both original equipment (OE) and replacement segments in the ongoing fiscal.
This is the first time that the company has associated with a celebrity as the face of its brand.
“We are proud to extend our relationship with Rohit who has been a stand out performer across all formats of cricket", said Anant Goenka, CEAT MD.
The sops for the tyre maker have raised expectations of revised deals for the state’s existing manufacturers, but industrialists say that a one size-fits-all approach may not work.
The new initiatives would raise the country's largest carbon black maker's capacity by another 50 per cent to 7 lakh tonnes.
Atma has also asked the carbon black manufacturers body to reveal the stock that is available for offtake.
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