apollo anju

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A PROJECT REPORT ONINTERNSHIP STUDY CONDUCTED ATAPOLLO TYRES LIMITED


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ContentsSl.no particulars Page

no1 introduction2


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ACKNOWLEDGEMENT

In successfully completing my project report, I am indeed indebted to a large

number of people who have encouraged and helped me in a variety of ways. Its

indeed a privilege to express my gratitude to the people involved.

First and foremost I am obliged to the Almighty who has showered upon me with

his blessings and giving me good health and knowledge to complete this

internship successfully.

I take this opportunity to express my special acknowledge and gratitude to Apollo

Tyres Ltd for giving me the permission to carry on my project in their reputed

organization. I wish to express my indebtedness and gratitude to Mr. Samuel

Wilson, HR Executive of Apollo Tyres Ltd.

With great pleasure I express my deep sense of gratitude and respect to Dr. Grace

Paul, HOD of Department of Commerce, Stella Maris College, Madras for her

excellent guidance and suggestions in the completion of this internship.

I wish to express my heart full gratitude towards my parents for their blessings

and moral support without which I would not have been what I am today.

Last but not the least I would like to thank my friends who were a source of

support and encouragement for successful completion of the internship.


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INTRODUCTION

Apollo Tyres Ltd is a high-performance company and the leading Indian tyre

manufacturer. Head quartered in Gurgaon, a corporate-hub in the National Capital

Region of India, Apollo is a young, ambitious and dynamic organization, which

takes pride in its unique identity. Registered as a company in 1976, Apollo is built

around the core principles of creating stakeholder value through reliability its

products.

Apollos present strength and market dynamism steps from its early years of strife

in establishing itself as a tyre manufacturer within the closed Indian economy.

Over two decades, Apollo worked on a portfolio of products, tuned to customer

needs and an array of innovative marketing initiatives to establish itself as a leader

in its home market. Some of these include segmenting customers by their load and

mileage requirements, running tyre loyalty programmes and establishing customer

contact programmes.

For the first time, in 2006 Apollo ventured outside India in its quest to test itself

outside its home comforts. Apollo acquired Dunlop Tyres International Pty Ltd in

South Africa and Zimbabwe,

The company currently produces the entire range of automotive tyres for ultra and

high speed passenger cars, truck and bus, farm, Off-The-Road, industrial and

specialty applications like mining, retreaded tyres and retreading material. These

are produced across Apollos eight manufacturing locations in India, Netherlands

and Southern Africa.


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INDIAN TYRE INDUSTRYA PROFILE

INDUSTRY OVERVIEW:

The Indian Tyre Industry has total turnover of Rs. 25,000 Crores with Tyre

production is 13.50 lakh. There are 50 tyre manufacturers across India. However,

the industry is dominated by 4 Major Player namely, Apollo Tyres Limited, CEAT

Limited, MRF Limited, JK Tyres and Industries Limited with total market share of

75%.Of total production, only 13.06% in value is exported by India. The major

export element is Truck and Bus category followed by passenger car.

This industry is highly Capital Intensive. The success in the industry is depended

on having robust distribution network and product branding.

The performance of commercial vehicle tyres is directly linked to the countrys

economic development and the performance of automobiles industry.

With rising Industrial and Agricultural output, Favorable demographic distribution

with rising working population and middle class Urbanization, and Fast growing

economy will infuse production of passenger carrier tyre demand in the country. It

is anticipated that the commercial vehicle tyre market will climb to Rs 22.8 Billion

by FY 2014.


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COMPANY PROFILEHISTORY OF APOLLO TYRES

Apollo Tyres Ltd. (ATL) was incorporated in 28th September, 1972 as a Public

Limited Company and obtained certificate of Commencement of Business on

October 24, 1972. The Company was promoted by Bharat Steel Tubes Ltd.,

Raunaq International Pvt. Ltd., Raunaq & Co. Pvt. Ltd., Raunaq Singh, Mathew T.

Marattukalam and Jacob Thomas. The company was taken over by Dr. Raunaq

Singh and his associates in 1974.The implementation of the tyre project took placein 1976 at Perambra in Kerala.

The research and development of Apollo tyres took place at Perambra and later it

had grown to a substantial height and stature at its present location at Limda,

Baroda. All the activities in the R&D center are extensively supported by a series

of highly sophisticated equipment that help the research scientists develop products

as per customers specific requirements.

Their second plant was installed at Limda village at Baroda in Gujarat, which

started production in 1991 having capacity of 6.5 lakh tyre/annum. This is most

modern plant.

The third plant at kalamassery was taken over by Apollo from Premier tyres. While

taking over this plant was a sick unit. After the takeover Apollo spent a good

amount in modernizing the plant and now it is profit earning unit. The fourth plant

was commissioned in 1996 at Pune for manufacturing tubes. The entire

requirement of tubes for all plants of Apollo is done from here.


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MILESTONES OF APOLLO TYRES:

1972. The companys license was obtained by Mr.Mathew T Marattukulam, Jacob

Thomas and his associates.

1974. The company was taken over by Raunaq Singh and his associates.

1975. Perambra plant foundation stone was laid down.

1976. Apollo Tyres Limited was registered.

1977. Plant commissioned in kerala with 49 TPD capacities.

1982. Manufacturing of passenger car radial tyres began in India.

1991. The second plant commissioned in Baroda, Gujarat.

1995. Aquired Premier tyres in kerala.

2000. Exclusive radial capacity established in Baroda.

2003. Radial capacity expanded to 6600 tyres per day.

2004. Launch of Apollo Accelere H speed rated car radials.

2005. Peramra plant completes thirty years.


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2006. Dunlop South Africa and Zimbabwe was acquired.

Expansion of passenger car radial capacity to 100000 tyres per day.

Launch of Indias first range of ultra-high performance V and W-speed rated

tyres.

Opening of Apollo Tyres health care clinic in Ukadam,Tamil Nadu.

Launch of Dura tead, trading material and solutions.

2007. Launch of Apollo truck and bus radial tyres.

2007. Launch of Apollo Tennis Initiative and mission 2018.

2008. Integrating the global product portfolio by rebranding the Dunlop brand and

rolling out new Dunlop Zones across South Africa.

2009. Aquired VREDESTEIN BANDEN B V in the Netherlands.


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CORE VALUES OF THE COMPANY

C - CARE FOR CUSTOMER

RR++ESPECT FOR ASSOCIATES

E- EXCELLENCE OF TEAM WORK

A- ALWAYS LEARNING

T-TRUST MUTUALLY

E-ETHICAL PRACTICES

VISION

A significant player in the global tyre industry and a brand of choice, providing

customer delight and continuously enhancing stakeholder value


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COMPANY MISSION

A journey called Passion in Motion

to be a US$ 2 billion company

by the year 2010.

COMPANY AT A GLANCE

Name of the company : Apollo Tyres Limited.

Business : Manufacturing and marketing Automobile tyres

Registered Office : Cochin, Kerala

Head Office : New Delhi

Manufacturing Units : Limda-Gujarat, Perambra & Kalamassery- kerala

Conversion Unit : TCIL- Calcutta

Technical collaboration : Continental General Tyres, USA


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BOARD OF DIRECTORS

Chairman : Onkar. S .Kanwar

MD : Neeraj R S Kanwar

Principal secretary ( Industries) , Government of kerala : T Balakrishnan

Principal secretary(finance), Government of kerala : L C Goyal

Former chief executive, Dunlop Tyres International(Pty) Ltd. : Michael J

Hankinson

Chairman , J M Financial Group : Nimesh M Kampani

MD, Apollo Tyres International Ltd. : Raaja Kanwar

Former principal secretary to the prime minister of India : Dr S Narayan

Chief, Corporate Affairs,ATL : U S Oberoi

Former Chairman , Industrial Development , Bank of India : M R B Punja

Share Holding Pattern

Promoters : 39.35 %

Fls / Banks / Mutual funds : 15.46 %

FIIs / NRIs / Foreign Bodies Corporate : 26.05 %


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Public : 17.16 %

Govt. of Kerala & others : 1.98 %

MARKET SHARE

Strong appetite for expansion saw Apollo becoming the number one tyre

manufacturer in the truck and bus tyre(Heavy Commercial Vehicle) segment in

india. With an average monthly production of 2,72,911 tyres, it ended FY 09 with

a 26 per cent share in the HCV segment. In the passenger car segment, Apollo had

an average monthly production of 2,63,779 tyres during FY 09, and ended the year

with a 19 per cent share.

PRODUCT PROFILE

Products Brands

Truck

Apollo

Loadstar SuperHercules

Loadstar Super Loadstar Super

Gold

XT 7 XT 7 Haulug

Champion Champion DXL Champion Gold Amar Amar Deluxe Amar Gold Amar AT-Rib


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XT7 Gold XT-9 XT-9 Gold

Kaizen

50 L 36 L Commando XDT

27 L 77 R 99 R Plus

Light

Truck

Loadstar Super Amar Deluxe Amar Gold XT-9

XT-9 Gold Duramile Milestar Champion

Passenger

Car

Car Radials

Tube Type (AmazerXL Quantum)

Tubeless Radials

4x4 Radials

Hawkz Storm Amazer XL

Alloy Wheels

Haste Torque

Inspire Slay


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Nirvana Frost Quest

Multispoke Sphere Cinco

Tubeless Radials

Acelere Amazer XL Hawkz

Conventional Tyres (Bias Tyres)

Car Armour Panther

Jeep Gripper Maha Trooper

Farm

Pure Cultivation Segment

Sarpanch Krishak SuperPure Haulage Segment

PowerhaulMixed Application Bias Segment

Krishak PremiumMixed Application Radial Segment

FarmkingJeep Gripper Maha Trooper


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APOLLO KEY DIFFERENTIATION TO OTHER FIRMS:

Superior product quality Strong brand equity Committed marketing team High consumer loyalty Product segmentation in truck tyres Bench marked for planning efficiency parameters. Power consumption Quick response to market needs Fuel efficiency Least scrap generation.

KEY DRIVERS FOR THE COMPANY

Execution Capabilities:The Company is in tyre manufacture business since 39 years and has

developed expertise in its line of operation. The Company is a leading player

in Indian market commanding 20% to total market share.

Diversified Customer Base:Segment wise major component of Revenue is from India comprising of

60% followed by Europe 27% and South Africa 13% based on Dec

2010(unaudited Result). Replacement category comprises 85% of revenue

segmentation by customer and Original Equipment Manufacturers

contributes to 15% of total revenue.


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Multiple Product:A wide range of products required by Indian Automobiles Industry is catered

namely, Truck and Bus Tyre, Passenger Car Tyre, Light Commercial

Vehicle tyres. The Company earns its major revenue from sale of

Commercial Vehicle tyres. To take the advantage of increasing disposal

income in India supported by availability of a variety of vehicle models

meeting diverse needs and preferences and easy financing scheme for

automobiles, the Company has launched passenger cars tyres for booming

small car tyre segment. The increase in disposable income has led to

increase in demand for passenger cars thereby the demand for tyres has also

increased. The additional demand for passenger cars will create replacement

demand in next 24- 48 months. Also, the growing economy has raised

demand for freight movement across the nation. This has led to increase in

demand for commercial vehicles and tyre demand from Original Equipment

Manufacturers, supported by replacement demand in next 12 -18 months

First Mover Advantage:The Company has a first mover advantage in its Chennai Plant. Chennai

plant currently produces 7000 passenger vehicle tyres and 1300 commercial

vehicle tyres a day. And by March 2012, its estimated production is

expected to reach 16,000 passenger vehicle and 6,000 commercial vehicle

tyres a day

Established Distribution Channel:The company is enjoying robust distribution network in India. Post

acquisition of Vredestein Banden BV in Europe in May 2009, the company

is benefitted with healthy distribution channel in Europe. This acquisition


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adds feature to companys plan to become market leader in Europe region.

For this, the Company has launched Winter Tyres for European Region in

range of passenger cars of 4X4 tyres. The European market provides

profitability margin to the tune of 16% compare to Indian market of 8-10%.

Beneficial Government Policies:To secure the interest of domestic player, Government of India has imposed

anti dumping duty on imports from China and Thailand for the period of 5

years from February 2010 onwards.

CHALLENGES FOR THE COMPANY

No Presence in Two and Three Wheeler Category:The Company does not have much presence in two and three wheeler tyre

segment in India. With Increase in disposal income, the demand of two and

three wheeler is expected to increase.

Increase in cost of raw MaterialTyre Industry is highly raw-material intensive. Raw materials cost accounts

for approx. 63% of tyre industry turnover and 72% of production cost. Raw

Material primarily comprises of natural rubber, nylon tyre cord and carbonblack. With rise in price of natural rubber touching mark of Rs. 185/kg in

Q3FY11 there is huge pressure on profitability margin.

Threat from Multinational Players:


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Multinational players like Bridgestone and Goodyear Tyres has robust

research and development facilities and spends huge on marketing to capture

market share.

Foreign Currency Volatility:The export comprises 40% of total revenue. As a result the company is

exposed to foreign currency fluctuations in respect of proceeds received in

various foreign currency. Major Customers are located in Europe and South

Africe. The fluctuation in the exchange rate between the rupee and other

currencies, including the USD, Pound Sterling, Euro etc. may adversely

impact the financials.

Golden achievements:

Apollo tyres ltd perambra unit was ranked the first among large scaleindustries for productivity and energy conservation in the year 2002-

2003 by kerala state productivity council.

Apollo tyres ltd received the pollution control award by the centralgovernment during the year 2003-2004

National safety council award 2005 Energy conservation award 2006 Apollo receives award for road safety 2006 Quality circle award 2006 National safety council award 2007 Overdrive award for Acelere.


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HUMAN RESOURCE AND ADMINISTRATIVE DEPARTMENT

Introduction

Human Resource at Apollo Tyres play a pivotal role of weaving the multi location

sales offices ,manufacturing plants and corporate office in a growth oriented

,employee friendly working environment .

Group manager leads HR department of ATL, HR manager deals with working lifeof a worker, from the time of his entry in to the organization until he leaves. It

basically includes activities such as HR planning, job design, performance

appraisal and job evaluation and motivation, welfare, safety and multi facts of

Industrial Relations.

It is divided into three sections namely industrial relations, security and

administration. Heads of each section are in direct contact with the department

head. Among the three sections, industrial relations is the biggest section having

four subsections looking into personnel and industrial relations, employees arrival

and depature, time, health and safety.

Key functions:

To design and implement procedures, policies and systems those aretransparent and help in achieving company goals.

Industrial relations To boost productivity and improve quality through internal customers


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Developing people and teams Managing change Integrating people into the companys vision, culture and philosophy Manpower planning, recruitment, employee orientation Induction, conformation, campus recruitment and internal recruitment Travel, transfer, ambulance room, statutory compliances Compensation policies, attendance and leave administration, payroll advice,

performance appraisal, training and development, benefit administration,

disciplinary action and safety

Focus areas of HR Functions

HR philosophy of Apollo Tyres Limited

Aims to play an active role in enabling the success and growth of theorganization

Continuous improvement in the quality of people and their approach towardscustomer service

Providing newer and more effective methods of managing and leading HR oriented growth strategies guide towards top level decisions Strives to maintain a balance between qualitative and quantitative results Creation of an organization wide involvement with the concept of HR Commitment of the top management, which is the backbone for the success

of all new HR initiatives


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The main functions of the HR department involve

Manpower planning Recruitment Selection Performance appraisal Training and development

MANPOWER PLANNING PROCESS

The manpower planning process is directly linked to the long term business plansof the organization. The manpower planning exercise is conducted annually to

assess the manpower requirements of the organization.

At the beginning of each calendar year, Corporate HR interacts with each

Department/Function in each Unit/Division to collect their manpower requirements

in conjunction with the annual projected business plan.

The following factors form the basis for the manpower planning exercise:

Product Mix Optimum equipment capacities Existing manpower Envisaged organization structure Comparison of actual versus expected productivity ( measured in terms of

Kgs/man-hour)

Inter-unit comparisons for common functions


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RECRUITMENT POLICIES

A well designed and pre-planning recruitment policy, based on corporate goals,

study of environment and corporate needs is essential for implementing the

organization mission and objectives.

The recruitment policy asserts the objectives of the requirement process and

provides a framework of implementation of the recruitment programme in the form

of procedures.

Recruitment is carried out in accordance with the annual manpower plan. Broadly,

requirement activities are done at either entry level or lateral level to cater to:

Replacement vacancies (occurring due to resignation, retirement or transfer) Additional vacancies ( created due to companys expansion /

diversification)

SELECTION

The job profile is communicated to the consultants and bio-data of candidates are

invited. The screening of bio-data is completed first by the concerned HR

department and then by the concerned Functional Head. An application blank is

filled is filled up by the candidate to facilitate the interview process. The

preliminary interview is conducted by the HR department. The final interview is

conducted by a panel consisting of the concerned Functional Head, and in case of

key positions, also by the president and/or VC&MD.

Selection procedure is different to different section of employees,


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1. Management staffi) Qualification:

For technical : M.tech, B.tech and Graduate

Engineering trainee for non technical : CA, ICWA, MSW, MBA

Executive trainees after training, they are absorbed as officer.

ii) Criteria includea) Consistency in academic performanceb) Preliminary testc) Group discussion( non technical)d) Technical interview( technical)e) Personal interview

PERFORMANCEAPPRAISAL

Objectives

The performance appraisal system has the following objectives:

Assessing past performance Providing rewards for performance Goal setting for the future Assessing training needs Assessing potential for growth


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Eligibility

All employees are to be covered under the annual appraisal; however, the trainees

and probationers are eligible for appraisal only before their due date of

confirmation.

Performance appraisal is to be done by the immediate superior to whom the

appraise is directly reporting, and the review is to be done by the department Head.

In cases where the functional and administrative reporting are separate, both the

appraisers are to asses independently and arrive at a joint decision (if location

factors are a constraint, then two separate forms are to be given to both the

appraisers and information collected is to be summarized by the HR department.

TRAINING AND DEVELOPMENT

Objective

The training and development procedure of Apollo Tyres Ltd has the following

broad objectives:

To porn up identified functional skill areas of personnel for more effectivecontribution to the organization.

To provide platform for personal growth and exploration leading to overallorganizational health and quality of life.

To develop human resource in consonance with broader corporate horizonand long range vision of the organization.


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The head of the corporate human resource is responsible for overseeing the

implementation of the training methodology. Respective Divisional HR is

responsible for implementing of the training procedure for the employee under

their purview.

Training Types

1) Induction Training

The new joinees in the organization are inducted through an induction program

with necessary retail and particular exposures to the organization realities .

2) On Going Training For Management Staff

The training needs of the employees are assessed on a 3 dimensional framework

viz .Functional, Cross Functional and self development .On the job training is

given to the regular employees of the company. The department heads identify the

training needs every year for individual employees of particular group and it shall

be communicated to the HR department.

HR department also has the following functions:

WELFARE MEASURES

The aim and objective of the welfare fund shall be to render financial assistance to

encourage cultural, sport, social and other welfare activities among the members

and to foster among them a spirit of mutual friendship, cooperation and

understanding. The organization provides good welfare services to its employees.

The company runs a subsidized canteen on a contract basis. Rest rooms with


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lockers and washing facilities, arts and sports club, library, etc are other facilities

provided. Transportation facilities are also provided to all employees. Company

buses will take the employees from different destinations for which they have to

pay a nominal amount. All the employees drawing a salary below 6000 are covered

under ESI and those who are exempted to ESI are covered under group accident

policy and MEDICLAIM policy. The welfare department also includes insurance

schemes, policies managing the welfare fund activities.

SAFETY

Safety section facilitates safe working conditions to all employees. The

organization follows all the provisions under the Factories Act 1948. All workers

are bound to observe safety precautions as directed and notifies from time to time

and use safety equipments or clothing as may be required by the management. All

accidents should be reported at once by the workmen concerned to his immediate

supervisor and in his absence to department head. Workmen should engage

themselves only to the operations at the machine to which they have been

appointment. Fire extinguishers are placed at reachable points and the employees

are trained to use them.

TIME OFFICE

The functions of the time office are as follows:

Maintain attendance record of the workers., staff and all employees Calculation of incentives Calculation of man-day, absenteeism, and maintain leave records Security executives Maintain security of properties, personnel and information


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Looks into the arrival and departure of employees, punching, control ofshifts, allotment of gate passes and movement pass of worker, visitors pass

etc.

PERSONNEL

Matters connected with recruitment, career promotions, transfers andposting, retirement and reservation guidelines concerning executives, staff

and workmen

Design and implementation of HR policies Matters connected with annual performance, assessment report of all

employees and all development activities.

Matters related to the appointment of employees, induction of apprentices,appointment of trainees under company scheme, etc.

Industrial relations:

Union management relation:-

A good industrial relation exists in the organization. The

management and the employees jointly find the solutions for the

problems there exists well relation between employer and employees.

There are four main trade unions recognized by the company:

i) ATSWN ( Apollo tyres staff and worker union)ii)ATEU ( Apollo tyres employees union)iii) ATMS ( Apollo tyres mazdoor sangh)

MUTUAL TRUST + UNDERSTANDING = TEAMWORK


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iv) ATWM ( Apollo tyres workers movement)

The trade unions which get atleast 20% of vote of total strength are

recognized by the management. The management has introduced a

long term settlement (LTS) plan, which is nothing but a collective

bargaining agreement. The decisions are taken jointly by the trade

union and the management. Also a part of the HR initiative employee

involving them in productivity relied issues such as quality circles and

professional circle, a social gathering such as factory day and othercelebrations encourage participation.

SWOT Analysis

Strengths

Continued market leadership in the dominant industry segment of truck and bus

tyres

Global presence with the acquisition of Apollo Tyres South Africa (Pty) Ltd.

(Formerly known as Dunlop Tyres International (Pty) Ltd.)

Extensive distribution networkin India and South Africa

Strong brand recall in a price sensitive Indian market

Responsive to changes in market conditions and product profiles

Global quality standards, international process and system certifications


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High usage of information technology systems to hasten the flow of information

and leverage opportunities across 140 locations in India

Dynamic and progressive leadership, willing to implement change

Economies of transportation cost, on account of closeness to natural rubber

growing belt

Global sourcing of raw materials

Weakness

No presence in two/ three wheeler segment

Declining profit margins due to raw material cost push Lack of clarity in career path Lack of flexibility of jobs among workmen.

Opportunities

Leadership position in the commercial vehicle segment will enable the Company

to leverage new and related business opportunities

New product segments like Truck/Bus Radial (TBR), Off The Road tyres (OTR),

retreading and allied automotive services

Growth in overseas markets like Europe

Threats

An increase in the flow of tyres from competitive sources like china


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Cheaper imports on account of import from countries which are signatoriesto regional trading agreements

With crude prices scaling upwards, pressure on raw material prices can beexpected

High expectations of labour in terms of compensation or welfare measure


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Conclusion- The Future

At Apollo Tyres, they believe in being in control of their destiny. They setambitious targets and believe in stretching themselves to outperform them.

Therefore, the leadership position in the Indian market notwithstanding, Apollo is

now set to look overseas for new challenges. Nearly all initiatives being taken at

this point in time are geared to fuel this ambition.

At home and abroad, Apollo is looking to not only consolidate its leadership

position in various segments through newer, high technology products but alsothrough consistent organic and inorganic growth opportunities, in tyres and allied

products. Becoming a leader in the passenger car tyre segment is a priority as is the

export of passenger car radials. If the company continues to grow at the current

pace, Apollo expected to reach the US$1 billion mark in less than five years.

Continuous focus on cost control and operating efficiency remains the hallmark of

the company.

Apollo has three tyre manufacturing facilities and one unit for the production of

tubes and flaps in four locations based in West and South India. Apollo endeavour

has been to have the widest spread of sales and regional offices, along with stock

points at locations which allow for maximum customer reach and efficient supply

chain management. Apollo dealer or business partners are also chosen with great

care. Apollo's products are sold through a combination of outlets ranging from

exclusive dealerships to multi-brand and branded retail outlets.

The continuous upgradation of dealer knowledge is in Apollo's interest and

therefore their training is undertaken by the company. With a dedicated field sales,


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technical and commercial force of 600, Apollo feels that they are best positioned to

meet the customer specific needs.

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apollo anju