Vredestein shows 'tech readiness' for premium segment, 12% revenue from exports: Neeraj Kanwar, MD, Apollo Tyres

Apollo Tyres, one of India's leading tyre manufacturers, has witnessed significant growth in recent years. The company achieved 65 percent net profit increase for FY 2024. Comparing FY 2023-24 to FY 2022-23, revenue grew by 3 percent to Rs 25,378 crores. Operating profit rose by 34 percent to Rs 4,447 crores, and net profit surged 65 percent to Rs 1,722 crores.We recently spoke with Neeraj Kanwar, Vice Chairman and MD, Apollo Tyres, who attributes this growth to a focus on the "capex light model" for the last 2-3 years. "We have only been spending on maintenance, and beyond that, most of our capex is going towards Digitalisation and Productivity initiatives," said Kanwar.
He elaborated that Apollo has been able to improve production efficiencies using AI and ML in the manufacturing processes, believing they can further improve capacity utilization levels to meet growing demand. At present, the company has a utilization rate of around 80 percent across its seven facilities - 5 in India and one each in Hungary and The Netherlands.
Make in India, make for the world. And the role of Vredestein..
Keeping in line with the government's ‘Make in India, make for the world’ strategy, Kanwar identified the US and Middle East as having the maximum potential to become top export destinations for India. He revealed that exports currently contribute around 12 percent to the revenue of Apollo's Indian operations. “We have developed these markets gradually for both Apollo and Vredestein brands, and we now have good demand from these markets,” he added.

A key driver of this export focus is the Vredestein brand, a 115-year-old European brand which Apollo launched in India back in 2021. "We are looking at leveraging that lineage of the brand, along with its customisation for Indian road conditions, to gain traction with the Indian consumers in the premium luxury segment," said Kanwar. Highlighting the design aspect, he mentioned the "signature touch of Giugiaro Design and Frascoli Design on Vredestein’s passenger car tyres and two-wheeler tyres respectively." This strategy seems to be working, as Kanwar reported good demand for Vredestein not only in India but also in export markets, with nearly 75 percent of Vredestein Tyres manufactured in India being exported.
The tyremaker recently debuted the Vredestein Ultrac Vorti, the first Made in India 21 and 22 inch tyres. While acknowledging the low volume in this segment, Kanwar said it is growing rapidly. The launch demonstrates Apollo's "technological readiness in this luxury segment of SUVs in India," he explained.
Mitigating challenges
Fluctuating rubber prices have been putting pressure on production costs across the tyre industries worldwide. To counter this, Kanwar said the company takes price corrections alongside internal cost control measures.
Additionally, the company has actively collaborated on various initiatives, notably partnering with 13-time Premier League champions Manchester United. In fact, the company’s long-term relationship with Manchester United has been a key strategy for brand visibility and customer engagement. "Our decade-long partnership with Manchester United has led to several engagement programs," said Kanwar. He pointed out initiatives like "Road to Old Trafford," aimed at young professionals, and "United We Play," which focuses on scouting football talent in Asia.
Apollo Tyres: Ready for the technological shift?
In India, following the trend overseas, there has been rapid advancements in the automotive industry, particularly with the arrival of electric vehicles (EVs). Speaking on how Apollo is preparing for the shift, Kanwar said "Tyre design and manufacturing have always evolved along with automobiles." He explained that EV tyres are different from traditional ones due to factors like higher weight and instant torque, and require lower rolling resistance for extended battery range. He added that Apollo is "a technologically advanced and adaptable organization" that constantly works on innovative solutions and is working on technologies that will keep the brand ready for future when mass EV adoption takes place in India.