Getting a Global Grip

Despite initial missteps in its pursuit of international stature, Apollo Tyres is still in the game. Along the way, it has not lost sight of the Indian market.

- Samar Srivastava

In 2005, the Onkar Kanwar-led Apollo Tyres was at a crossroads. The tyre manufacturer had just pulled out of its two year joint venture with French peer Michelin. The partnership that was forged to make radial tyres for trucks and buses never took off because the Indian market was not adopting radial tyres at the projected rate. Hence, for the first time in its 29-year history, Apollo Tyres was without a partner and, more ominously, without a technological tie-up.

Kanwar’s younger son Neeraj, who took over the day-to-day operations of the Gurugram-based company from his father in 2002, knew it was time to sharpen its focus. The junior Kanwar decided to take his 18-member management team to Wildflower Hall in Mashobra near Shimla for a strategy session chaired by the Boston Consulting Group. Three themes emerged at the meeting. “We had to de-risk our business from the Indian market by going global, become self-reliant in technology and also train our personnel,” recalls Neeraj, 45, who is the managing director.

Measured against these objectives, Apollo Tyres’ journey is still a work in progress. Neeraj has tried his hand, and in a manner of speaking, burnt it, at taking the company global. (The company sold its first acquisition and the second is an unfinished project. A third deal fell through.)

Apollo Tyres, and the tyre industry in general, has also had a stroke of bad luck in recent times. Cheap Chinese imports and global woes have impacted topline. For the year ended March 2016, revenues were down to Rs 11,793 crore from Rs 12,815 crore in the previous year as the rupee appreciated by 6.25 percent against the euro in the period.