Apollo increases Chennai tyre plant by 50%

Apollo Tyres Ltd’s board of directors has  approved the expansion of truck-bus radial capacity at the Chennai plant from present levels of 6000 tyres per day to 8900 tyres per day. According to the company this move stems from the fact that the Chennai plant is outperforming projections.

The board also approved a further conversion of the company’s Kalamassery plant, in the rubber producing southern Indian state of Kerala, from bias truck tyres to specialty/industrial tyres.

The company estimates the two moves will require capital expenditure of US$340 million (20,500 million rupees). The company plans to raise funds to pursue these projects and for “other corporate purposes”. The board also authorised the company to raise funds, subject to approval from shareholders, through issue of securities to the extent of $200 million, in one or more tranches. This means fundraising either by “rights issue/ preferential issue/ private placement (s)/QIP/ Public Issue of equity shares at par or premium, convertible or non-convertible debentures with warrants and/or by way of issue of FCCBs and/or such other instruments…”.

The management  also approved increasing the limit the limit of investments originating from Foreign Institutional Investors (FIIs) from 40 to 45 per cent of share capital.