MRF looking at growth options

Indian tyre maker MRF Ltd. is eyeing several acquisition opportunities but remains cautious over committing itself to inorganic expansion, chairman and managing director K.M. Mammen told The Times of India. Referring to the aborted deal of major Indian rival Apollo Tyres, whose acquisition of Cooper Tire & Rubber Co. came undone, Mammen told the newspaper, “You can acquire like how my dear friends did and then get slapped.” He added: “There is a way of acquiring. You should acquire what you can swallow. A bad acquisition can kill you.”

Mammen said that the firm is studying multiple targets, and that opportunities for partnerships and part ownerships existed. The firm is also looking to set up a factory outside India. “Today, manufacturing outside India is much more advantageous,” he said.

According to Mammen, MRF continues to invest Rs 8 billion to 10 billion (approximately £80 to £100 million) a year as capital expenditure and will invest a similar amount this year. MRF saw its net sales inch up 2.3 per cent to Rs 122,480 million (£1.2 billion) for the year ended 30 September 2013, but net profit rose 39.5 per cent to Rs 8,080 million (£80.1 million) over the year-ago period.                Tire Review