APOLLO TYRES LTD

CHAPTER - 1 INTRODUCTION

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APOLLO TYRES LTD

INTRODUCTION
Apollo Tyres is one of the largest tyre manufacturing companies in India. The company was incorporated industry. The company can !e traced !ac" to the 7 #s when hard$nosed %&'#s and Indian tyre ma(or dominated the tyre industry. Apollo set up its very first manufacturing unit in )eram!ra* +erala in 1977* with a very huge production capacity of 1,- tonnes. It was in 19,2* that Apollo formulated and put into action a series of pragmatic pro(ect generating policies that led towards a turn around. A dynamic new management team under the leadership of .ice$'hairman and %/* %r. On"ar S +anwar too" over the helm of the company affairs. O!(ectives were redefined and service aggressive mar"et penetration and e0pense containment !ecame order of the day. Apollo Tyres 1td. is the leading Indian tyre manufacturing with annual revenues of over 2S 3 1 !illion. In fact it is the first Indian tyre company to reach this milestone. In 2 4* Apollo ac5uired /unlop Tyres of South Africa. The company has its operations in India* South Africa and 6im!a!we with a networ" of over 7* dealerships in India alone. Sometime in 8anuary* the company also announced its plans to start its operations in 9ungary. %y pro(ect at Apollo tyres ltd. )eram!ra in Thrissur is a hum!le effort to understand and comprehend its organi:ation. The pro(ect is intended to access and to ac5uire the "nowledge regarding the functional as well as the management aspect of the firm. in 1972 and commenced its production in 1 accreditation in Indian tyre 1977. It was the first company to receive ISO9

OBJECTIVES OF THE STUDY

The organi:ation study is to familiari:e ourselves with the wor"ing of various departments for a particular period* so that one can have an e0posure to the practical side. The o!(ectives include; 1. To understand the organi:ational structure of Apollo tyres 2. To understand the various "ey functional areas of the company <. To get an idea a!out e0isting !usiness operations at Apollo tyres Page 2

APOLLO TYRES LTD 7. To interact with managers at various levels of the organi:ation hierarchy -. To analy:e the practical aspect in relation to the theoretical aspect of the organi:ation 4. To gain a clear picture a!out the challenges and activities faced !y the organi:ation 7. To o!serve the wor" culture e0isting in the organi:ation ,. To identify the strength and wea"ness of the organi:ation 9. To analyse competition within the industry.

SCOPE OF THE STUDY

Apollo Tyres* )eram!ra has all those function areas such as production* finance* personal* and mar"eting etc. The study is focused on the functioning of each department of the organi:ation giving emphasis to their wor"ing.

METHODOLOGY
To conduct the study* different methodologies have !een adopted. The study was underta"en !y visiting the plant. =oth )rimary and Secondary data are used.

DATA COLLECTION 1. Primary So r!"#

o /irect interview with the department heads o /iscussion with the divisional heads o Interaction with wor"ers in the company o /ata collected !y o!serving the function of the organi:ation

$. S"!o%&ary So r!"#
Annual reports of the company /epartment manuals )eriodicals* !oo"s* etc. pu!lished materials !y the company Internet we!sites >www.apollo.com* www.google.com?

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APOLLO TYRES LTD

LIMITATIONS OF THE STUDY

The time period availa!le for the study was limited The study was conducted only during the day shift and hence the wor"ing conditions of those employees wor"ing during the evening and night shifts could not !e e0amined

CHAPTERISATION
C'a()"r 1 Introduction @ O!(ectives* Scope of the study* %ethodology* Sources of data* 1imitation of the study* chapterisation C'a()"r $ Industry )rofile @ 9istory of tyre industry @ Aorld scenario* Indian Scenario* State Scenario* Blo!al position of Apollo Tyres. C'a()"r * 'ompany )rofile @ Organisational goal* 9istory of company* 'ompany#s vision* 'ompany#s %ission* O!(ectives of company* corporate social responsi!ility* Achievements* =an"s of the company. )roduct )rofile @ Truc"* 1ight commercial vehicles* )assenger car radials* Carm. %ar"et )rofile @ %DC* A)O11O TEDFS* 8+ industries* 'FAT* BOO/EFAD I&/IA C'a()"r + Organisational Structure @ Organisational chart C'a()"r , Analysis of functional departments C'a()"r SAOT Analysis @ 'ompany#s Strength* Aea"ness* Opportunities G Threats are e0plained. C'a()"r . )orter#s five force in Apollo C'a()"r / Cindings* conclusion G suggestions =i!liography Appendi0 Page 7

APOLLO TYRES LTD

CHAPTER 0 $ INDUSTRY PROFILE

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APOLLO TYRES LTD

1ORLD SCENARIO
Aorldwide* the automo!ile industry is the single largest consumer of natural ru!!er in the form of auto tyres and tu!es certain other parts and accessories. Cor instance* 8apan#s =ridgestone 'orporation is the world#s third largest producer of tyres. It consumes < la"h tones of natural ru!!er annually to produce 4, different types of tyres. Italy#s )irelli SpA consumes 12 tonnes of natural ru!!er in the production of tyres. Fconomic recession anywhere first hits this industry !efore any other industry. Therefore* the world price of ru!!er goes through a cycle o few years of !usts with the state of world economy. The engineers forecast that tomorrow#s tyres will have possi!ly have inflation with gases* which is heavier than air to prevent inflation loss. The advent of computer has revolutioni:ed the tyre technology and tyre industry. The tyre industry was grown to one of the largest industries in the world.

1ORLD RUBBER 2 TYRE FORECASTS FOR $311 2 $31The world tyre industry is worth around 2S 3 7 !illion. The industry is mar"ed !y the presence of around half a do:en ma(or players who together occupy to 7 H of the world mar"et share. The glo!al demand is to rise 7H annually through 2 11. Aorld ru!!er consumption is forecast to increase 7. percent annually to 24.million metric tonnes in 2 11. Bains will directly !enefit from solid growth in world motor vehicle production* as well as a strong glo!al economy. 'ountries li"e the 2S* 'hina and 8apan dominate glo!al ru!!er consumption* and will continue to do so* collectively accounting for more than half of the mar"et in 2 11. 'hina has !ecome the leading consumer of ru!!er worldwide* following more than a decade of strong growth in motor vehicle production and industrial goods manufacturing. The country overtoo" 8apan as the second largest ru!!er mar"et in the late 199 #s and !y 2 1 had essentially caught up with the 2S as the world#s leading consumer. Ahile 'hina will continue to e0tend that lead* the 2S and 8apan will remain leading mar"ets worldwide* !ecause of their e0tensive motor vehicle and tyre industries. Page 4

APOLLO TYRES LTD The strongest gains are forecast for 'hina* though the dou!le digit annual gains that characteri:ed 'hina#s ru!!er mar"et from 2 1 to 2 4 are forecast to slow significantly as its domestic mar"et matures and motor vehicle production decelerates. The 'hinese mar"et will !e sustained primarily !y e0panding demand for industrial ru!!er products such as hoses* !elts and gas"ets* offsetting slower* though still solid* growth for tyre ru!!er. A!ove average gains also are forecast for most of the AsiaI)acific region* e0cluding 8apan* which will !enefit from strong economic growth and rising motor vehicle production. In addition the growing tyre industries in these nations will support demand for ru!!er. Among the ma(or developed regions* the large &orth American* Aest Furopean and 8apanese mar"ets will all see gains !elow the glo!al average. Fach of these regions will suffer from a wea" outloo" for the regional motor vehicle industry and competition from nations with lower la!our or raw material costs.

MAR4ET SHARE OF VARIOUS COMPANIES

'O%)A&E %ichelin =ridgestone Boodyear 'ontinental Sumitomo )irelli Eo"ohama +umho Others %AD+FT S9ADF >H? 19.7 19.7 14.4 7.1 7.9 <.9 <.1.7 2<.>Ta!le &o ; 2.1?

The tyre industries were classified under three heads. The first generation industries vi:. /unlop and Cirestone >new =om!ay Tyre International 1td? were set up in the last < #s and early 7 #s.The second generation companies came up in 4 #s are %DC Tyres* 'FAT* Boodyear Tyres and )remier Tyres. The third generation companies that were set up in 7 #s are 8+ Tyres* .i"rant Tyres* Apollo Tyres and %odi Du!!er. Fver since the first Indian company /unlop Du!!er 'ompany was incorporated in 1924 the tyre industry is growing

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APOLLO TYRES LTD rapidly and today its turnover is 1 million and earning an income of Ds. 1

crore per annum for e0ports. The industry had a growth rate of 11H over last decade. Indian tyre industry comprises 12 ma(or companies* 1< minor ones and <7 minor plants manufacturing low technology products* such as small tyres* tu!es and flaps. There are top players in this field having 49H of mar"et share.

MAR4ET SHARE OF LEADING TYRE COMPANIES

'O%)A&E %DC 8+ Tyres Apollo 'FAT /unlop Boodyear Others Tyres are !asically two types; 'ross ply Dadial %AD+FT S9ADF >H? 21.2 17.1 14.2 17.7. 4. 1,. >Ta!le &o 2.2?

In cross ply tyres* nylon or rayon tyre cords are arranged diagonally across. In radial tyres* polyester* nylon* fi!re glass or steel cords are arranged perpendicular to the circumstances. Dadial technology is an improvement over cross ply and radial tyres are priced at >of 2-$< H? premium. They are long lasting and have lower incidence of flats. In domestic industry mar"et demand for cross ply tyre is more !ecause of rough conditions and also it is cheaper than radial. India is still in the in the cross play age when developed countries are into radial and tu!eless tyres. The tyre industry in India is predominantly dependent on natural ru!!er as against synthetic ru!!er. Analysis !y F0perts reveals that the ratio of natural ru!!er usage to synthetic ru!!er is , ;2 in Indian tyre and < ;7 in worldwide. Indian tyre industry even though in its infant stage has !een striving hard to esta!lish itself in the glo!al mar"et. There are threats from glo!al players who en(oy su!stantial economies of scale dominant mar"et. The fortune of the tyre industry depends on the agricultural and industrial performance of the economy. The

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APOLLO TYRES LTD transportation needs tyres and vehicles. 9ence* this is a very sensitive industry* which has to adopt itself to a highly volatile environment.

INDIAN SCENARIO
The origin of the Indian Tyre Industry dates !ac" to 1924 when /unlop Du!!er 1imited set up the first tyre company in Aest =engal. %DC followed suit in 1974. Since then* the Indian tyre industry has grown rapidly. Transportation industry and tyre industry go hand in hand as the two are independent. Transportation industry has e0perienced 1 H growth rate year after year with an a!solute level of ,7 !illion ton freight. Aith an e0tensive road networ" of <.2 million "m* road accounts for over ,-H of all freight movement in India. The Indian tyre industry is mainly dominated !y the organi:ed sector and consists of four ma(or players who together account for appro0imately ,-H of the industry#s turnover @Apollo Tyres 1td.* %DC 1td. 8+ Tyre G Industries 1td* and 'FAT 1td. These companies have a presence in all the ma(or segments of the tyre industry @ the replacement mar"et* Original F5uipment %anufacturers >OF%s? as well as e0ports and conse5uently* offer the consumer a well diversified product mi0. There are many other companies* some in the unorgani:ed sector and mostly smaller in si:e* with a focus only on one or two categories of tyres* tu!es and flaps primarily for the replacement mar"et. 2nli"e the international tyre industry where passenger car radials dominate the mar"et* in the Indian industry commercial vehicle tyres ta"e the lead and account for appro0imately 7 H of the industry#s turnover. As a result* the growth of the entire tyre industry depends on primary factors li"e agricultural growth* overall B/) growth* industrial production* growth in vehicle demand and secondary factors li"e infrastructural development* prevailing interest rates and financing options. Cor the last 1 years* Apollo Tyres has maintained its leadership position in the commercial vehicle tyres segment. Although the automotive sector in India saw negative growth in the medium and heavy commercial vehicle segments* this downward trend was in contrast to the strong demand witnessed !y the tyre industry. 1ed !y replacement mar"et growth of over 1 H* the tyre industry registered a high single digit growth. The tyre industry is highly raw material intensive and a ma(or consumer of ru!!er. Aith raw material costs accounting for 7 H of the cost of production* any change in the price of ru!!er Page 9

APOLLO TYRES LTD or the crude !as"et has a direct impact on the cost of production. The comparatively sta!le raw material prices in the first half of CE 2 underta"en !y the industry in CE 2 7$ ,* coupled with price increases 4$ 7* resulted in all the ma(or players reporting

improved operating profit margins. This was after tour consecutive years of raw material cost$push* !oth for natural ru!!er and crude oil$ lin"ed raw material !as"et. The second half of CE 2 7$ , again saw an upward trend for all ma(or raw material prices and the same is anticipated for the year ahead. As a result* margins are once again under pressure* even while the demand$supply situation continues to !e in favour of the industry. Sa5i"%) 6"a) r"# o6 I%&ia% )yr" i%& #)ry Adapta!ility and a!sorption F0ports Innovation Indigenous and ready availa!ility Technology progression Aide product range for diverse use Self sufficiency and vi!rant mar"eting setup

INDIAN TYRE INDUSTRY HIGHLIGHTS

The Indian tyre industry is a 9 crore industry The fortune of this industry depends on agricultural and industrial performance of the economy* the transportation needs and the production of vehicles The tyre industry is mainly dominated !y the organi:ed sector* the unorgani:ed sector holds away in the !icycle tyres The ratio of natural ru!!er content to synthetic ru!!er content is , ;2 * in Indian tyres the ratio of natural ru!!er to synthetic ru!!er is < ;7 .

DEMAND AND SUPPLY FACTORS

The drivers of demand in the Tyre industry are Industrial and freight activities Page 1

APOLLO TYRES LTD )ersonal purchasing power Fconomic activity

APOLLO 7i% )'" I%&ia% #!"%ario8

Apollo Tyres 1td. is the leading Indian tyre manufacturer* with annual revenues of over 2S3 1.2 !illion >2 7$ ,?. It was founded in 197-. Its first plant was 4 the company ac5uired /unlop commissioned in )eram!ra in +erala state. In 2

Tyres International of South Africa. The company now has four manufacturing units in India* two in South Africa and two in 6im!a!we. It has a networ" of over 7 dealerships in India* of which over 2over 9 are e0clusive outlets. In South Africa* it has ,* the dealerships* of which 19 are /unlop Accredited /ealers. In early 2

company announced plans to open a manufacturing plant in 9ungary. Apollo Tyres 1td.J has !een a pioneer in the implementation of KSi0 SigmaJ among all the tyre companies in India* and is in the list of top 1manufacturers of the world in terms of Devenues. 12 sales* services and stoc" points 19 state offices 7 21 L !usiness partners L Apollo tyre world

19 L Apollo Dadial world 14 L Tu!eless service points 4 L Apollo )aragati +endras

STATE SCENARIO
Apollo had secured Cifth place in the state of +erala. In the state of +erala %DC has secured the first position with < H o the mar"et shares under its control. This is followed !y 8+ with 27H of the +erala state shares. 'FAT* Bood Eear follow 8+ with 17 and 12H respectively. Apollo holds the fifth position with 1 H of the mar"et shares in +erala.

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APOLLO TYRES LTD

CHAPTER * COMPANY PROFILE

ORGANI9ATION GOAL
MEou can#t stop the power of thought* nor can you stop the people !ehind it#. Page 12

APOLLO TYRES LTD

HISTORY OF THE COMPANY

&amed after the Bree" Sun Bod* Apollo* the company Apollo Tyres has created a niche for itself in the Indian tyre mar"et. After three decades of consisted growth* today it is the premier tyre manufacturing company of India.

K)FO)1F /F1I.FD I&&O.ATIO& I&&O.ATIO&S /F1I.FD S2''FSS A CFA OC T9F /ICCFDF&'FS O2D )FO)1F %A/FJ
The history of the company dates !ac" to the early 7 #s. In 1972* license was o!tained !y %r. %athew T %arattu"alam* 8aco! Thomas and his associates. The company was ta"en over !y /r. Dauna5 Singh and associates in 1977. It is one of the flagships companies of Dauna5 group. The plant is situated at )eram!ra - "ms north of 'ochin. Total area covered was 97 acres which was !ought from the people who stayed there at a cheaper rate. At the starting time the production capacity was -7 tonnes per day. The Apollo Tyres 1td. owned !y Dauna5 group of industries plays an important role in the world tyre industry. The products include tyres* tu!es and flaps for all "inds of vehicles. The head office of the company is at &ew /elhi and the registered office is at 'ochin. The main mar"eting activities are concentrated in &ew /elhi and 27 e0clusive dealers for Apollo cover the entire area of India. /uring 1977 to 19,1 the company was under a heavy loss. The capacity utili:ation was only 7 to - percentages. The emphasis is given on growth* 5uality and o!(ectives were re$defined when %r. On"ar. S +anwar too" over the company#s affairs. 'ompany !egan to earn profits and accumulated losses of 24 crores were wiped out within a short span of time. Their second plant was installed at 1imda village at =aroda in Bu(arat* which started production 1991 having capacity of 4.- la"h tyre per annum. This is the most modern plant. The DG/ centre is also functioning at this location. The third plant at +alamassery was ta"en over !y Apollo Tyres from )remier Tyres. Ahile ta"ing over this plant* it was a sic" unit. After the ta"e over Apollo spent Page 1<

APOLLO TYRES LTD a large amount in moderni:ing the plant and now it is a profit earning unit. The fourth plant was commissioned in 1994 at )une for manufacturing tu!es. The entire re5uirement of tu!es for all plants of Apollo is done from here. In truc" tyres it has more than < percentage mar"et share. The !rand NT7 !ecame the largest selling truc" tyre in the country. The vision of the company is to !e a leader in the Indian tyre industry and a significant glo!al player.

APOLLO TYRES PERAMBRA

YEAR OF INCEPTION LAND AREA BUILDING AREA PRESENT CAPACITY PRODUCT RANGE 1974 97 A'DFS 49*- SO.%TS < %TI/AE Truc"* 1'.* Dear Tractor* Carm Dadial* )assenger G A/. Tyres

>Ta!le no <.1? APOLLO TYRES OUTLOO4

B #i%"## A!)i:i)y; %anufacturers and sale of tyres A55i"& B #i%"##"#; Tread ru!!er for commercial vehicle tyres and distri!ution of alloy wheels for passenger cars. A!"5"r"1'""5<; )remium alloy wheels* first from a tyre company in India. A(o55o D ra Tr"a&#; India#s !est pre$cured tread ru!!er. A(o55o D ra Tyr"; India#s first !randed re$treaded tyre* dedicated retreading plant which is launched in %ay 2 vehicles. Fi%a%!ia5 Y"ar; April 1 to %arch <1 Page 17 7. So )' A6ri!a; /istri!ution of 'ooper Tyres and steel wheels for commercial

APOLLO TYRES LTD I%&ia N") Sa5"# T r%o:"r FY $33,-3-; Ds. 24.< !illion >22.<? or 2S3 - < million >79-?* Ds 1-.2 !illion or 2S3 <<2 million. So )' A6ri!a CY $33,; Dand 1<<9 million or 2S3 21 million* Dand 792 million or 2S3 117 million. No. o6 "m(5oy""#; 13333= Cor(ora)" H"a&> ar)"r#; Apollo 9ouse* 7 Institutional Areas* Sector <2* Burgaon* 9aryana122 1* India. )hone; L91$127$2<,< 2 to 1 . Ca0; L91$ 127$2<,< 21I 17 1* +wa6ulu &atal* South Africa So )' A6ri!a O66i!"; 24- Sydney Doad* /ur!an 7

The R"?i#)"r"& O66i!"; 4th Cloor* 'herupushpam =uilding* Shanmugham Doad* 'ochin* +erala 4,2 <1* India. )hone; L91$ 7,7$2<,19 2* 2<,19 < Ma% 6a!) ri%? Fa!i5i)i"#; Three >India?* Two >South Africa?* One >6im!a!we? Pro& !) Ra%?"; Truc"* =us* 1ight Truc" Dadial and 'ross$ )ly* )assenger 'ar Dadial* Carm Dadial and 'ross$ )ly* Off$ The @Doad* Farthmover Industrial O:"ra55 Ca(a!i)y; <17 tonnesI year 4"y Bra%&#; Apollo* /unlop* India Tyres* +ai:en* Degal Tyres O)'"r Bra%&# Ma% 6a!) r"&; &ove0* %aster Steel* %ilestone* TEfoon* and .elocity.

APOLLO TYRES LTD-PERAMBRA PLANT IN FOCUS

AT1 )eram!ra 2nit is the mother plant of Apollo family It is the single largest truc" tyre plant in India Castest growing plant in Apollo Camily 7th fastest growing tyre company in the world Cirst tyre company to o!tain ISO 9 1 certification

)resent production capacity of < 7 %TI day It has nearly 27 employees

Cour different trade unions

Gro@)' o6 )'" Or?a%i<a)io%

Apollo Tyres 1td. have 7 manufacturing plants in India is having a mar"et all over the country. Indian passenger car radial tyres have also !een gaining acceptance

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APOLLO TYRES LTD in the developed mar"ets. India is leveraging its cost competitiveness to emerge as a ma(or player in the segment of industrial tyres. 9ead Ouarter )lants 6onal Offices ; ; ; Burgaon =aroda* 'ochin >2?* )une =angalore* +ol"ata* /elhi* 8aipur G %um!ai Dedistri!ution centre ; =aroda* 'oim!atore* /elhi* Ichapuram* Indore*8aipur*9u!s in +ol"otha* Buahati and )atna. 9owever* the large and growing domestic mar"et has meant that the e0port portfolio has always contri!uted a smaller portion of revenues. This is more so given that reali:ations are !etter in the domestic mar"et. In recent years* e0ports have !een a growth area for Apollo Tyres* even though it comprises only ,H of overall revenue. )roducts e0ported primarily include truc" !ias* light truc" !ias and passenger car radial. The "ey e0port mar"ets include South America* Africa* %iddle Fast and South Fast Asia. Inroads are now !eing made into Furope and Australia with high performance passenger car radial tyres. Apollo tyres recently ac5uired /unlop tyres South Africa and started its operation over there.

DREAM OF APOLLO
To !ecome a 9 crore company !y the year 2 1

COMPANY VISION
KA significant player in the glo!al tyre industry and a !rand of choice providing customer delight and continuously enhancing sta"eholder valueJ COMPANY MISSION KTo !ecome a 2S/ 2 1 million company !y the year 2 1 J KTo create the first Indian Singles Brand Slam 'hampion !y the year 2 1,J OBJECTIVES OF THE COMPANY 9igh volume* high mar"et share* cost effectiveness in all segments. 9igh 5uality* technically superior products. Page 14

APOLLO TYRES LTD 'onsistent production through harmonious industrial relations. Achievements of customer delight through !enchmar"ing glo!al practices. Strengthen supply chain management. Devenue growth. Operating margin improvements. Fmployee satisfaction.

HUMAN CAPITAL 1a!our %anagement staff )ermanent staff Aor"men trainees 'ontract wor"men Total &o. of people 21< 1927 11< 7-< 27 < >Ta!le no; <.2?

GOAL OF APOLLO 1earning and /evelopment Fmployee safety Camily Cocus 9ygienic Cactor Fmployee Involvement and 'ultural =uilding Fmployee satisfaction 'ustomer delight Devenue growth Operating margin re5uirements

AUALITY PLEDGE KAe the people of Apollo Tyres 1td will create an enterprise committed to 5uality. It is our policy to design* manufacture and services our products to provide the level of 5uality and valve that meet every customer#s need. Page 17

APOLLO TYRES LTD Ae will aim to generate customer enthusiasm through continuous improvement in our products and servicesJ. APOLLO ONE FAMILY Arts /ay Sports /ay Cactory /ay Safety /ay Onam 'ele!ration Summer 'amps

APOLLO -A RESPONSIBLE CORPORATE

Indirect $/irect persons are locals? $27 < persons >1-

PLANTS IN INDIA
Sl.&o 1 2 < 7 )1A&TS A)O11OTEDFS1T/* )FDA%=DA +FDA1A A)O11O TEDFS 1T/ *

+A1A%ASSFDE* +FDA1A A)O11O TEDFS 1T/ * =ADO/A B28ADAT A)O11O TEDFS 1T/* )2&F

%A9ADASTDA A)O11O TEDFS 1T/* '9F&&AI TA%I1 &A/2

>Ta!le no <.<? PLANTS ABROAD

Sl.&o 1 )1A&TS A)O11O TEDFS * =21AAAEA* 2 6I%=A=AF A)O11O TEDFS* Page 1,

APOLLO TYRES LTD 1A/E%IT9 SO2T9 < ACDI'A A)O11O TEDFS* /2D=A& SO2T9 ACDI'A

>Ta!le no <.7? GLOBAL POSITION OF APOLLO TYRES LTD EFAD 2 7 2 2 4 2 7 2 , )OSITIO& 17 14 117 17 >Ta!le no <.-?

APOLLOBS CORPORATE SOCIAL RESPONSIBILITY

=y giving !ac" to society in every way possi!le* one !uilds synergies with the core !usiness* leading to a sustaina!le effort. Apollo Tyres !elieve true sustaina!ility is only ensured !y the positive impact of !usiness practices. The company has invested in efforts to !uild awareness a!out AI/S and has underta"en to !ring solutions to the pro!lems of the community at large. Decogni:ing that an optimistic and progressive environment not only enhances productivity* !ut also promotes a feeling of well !eing* all around* our initiatives in 'orporate Social Desponsi!ility are an integral part of the !usiness activities and not outside them. The principles of sustaina!ility are inherent in our vision statement focusing on Mcontinuously enhancing sta"eholder value.# 'SD is recogni:ed as a "ey strategy to manage the !usiness and operational challenges. The organi:ation#s strategy is to !uild "ey partnerships and lin"ages to optimi:e the e0isting resources in reaching out to more people. The organi:ation is conscious of the triple !ottom line concept and is wor"ing towards putting advanced and integrated management system on environment* health G safety and social aspect. =eing a people centric !usiness* at the onset* Apollo Tyres undertoo" to !ring Page 19

APOLLO TYRES LTD awareness and solutions to the pro!lems effecting those mem!ers of the pu!lic that are in closest contact with the company$ the truc"ing community. Crom then on* the 'SD activities have e0panded to include women* children and the disadvantaged* in colla!oration with &BO#s and other e0ternal agencies. The current and planned 'SD programs are primarily focusing on health and education* in !road alignment with %illennium /evelopment )rograms of 2&/). All programs* e0cept 9I.$AI/S* are currently in the domestic mar"et. As the geographies of operations e0pand* 'SD programs will !e underta"en after due needs assessment of the location. Some of the planned activities will re5uire local &BO support. 9I.$AI/S initiative is the !iggest an most comprehensive programs at Apollo. The organi:ation recogni:es it as a development and wor"place issue and has a detailed action plan covering "ey sta"eholders. Apollo Tyres 9ealth 'are 'linics >for customer#s i.e. truc"ers? have !een esta!lished in and around cities li"e 2ttar )radesh* Tamil&adu* %aharashtra* Da(asthan* &ew /elhi* and other large transportation hu!s in India. Dun !y 5ualified doctors* counsellors* pharmacists* and outreach wor"ers* the 'linics focus on diagnosis and treatment of se0ually transmitted diseases* condom promotion and effective communication to promote !ehavioural change$ Aor"place programs >employee? in India and SA. Training and leveraging supply chain in ta"ing the message forward in line with Apollo Tyre#s commitment to capacity !uilding. Sample surveys were also carried out to record the "nowledge* attitude* !ehaviour and practices. Fmergency %edical Services >F%S? around our manufacturing locations in India. Fsta!lished highway rescue pro(ect in Bu(arat and city F%S in .adodara )lan to launch in +erala. 9ealth 'amps G %edical assistance in the villages surrounding the manufacturing location generate awareness a!out deadly diseases li"e 9I.IAI/S* %alaria* T=* 'hic"engunia* etc. 9ealth camps on 9I.IAI/S* T=

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APOLLO TYRES LTD and %alaria are panned for truc"ers in the 9ighway regions as well as in the remote villages. )rovision of artificial lim!s to war wounded soldiers. Adult 1iteracy classes for villages. S"ill development for women in villages with a view to ma"ing them self sustained mem!ers of the community. Tailoring classes are arranged on an ongoing !asis and an Anganwadi >crPche? was also provided to ta"e care of the children from economically underprivileged families. )rimary education in "eeping with %illennium /evelopment Boal in the villages involved awarding scholarships to support !right students from economically !ac"ward sections of society. %aintenance of school !uilding in the villages. )rovision of computers to the schools in the villages. )rovision of water tan" for the village as well as laying a pipe line to !ring supply of drin"ing water for the School* +oda"ara* )eram!ra. Opportunity of self employment I entrepreneurships to war wounded soldiers resulting in revenue generation for them and the organi:ation. 'ustomer promotion on safe drive environment 'onducting Safe /rive 'ampaign on the national e0pressways* which included chec"ing the tyres for damages or wear patterns to ensure that they were safe for an e0pressway (ourney. 'ustomers were also given Safe /rive !oo"lets. 2 such Safe /rive campaigns have already ta"en place across the country this year. Twenty more are planned. Aind Fnergy pro(ect initiated si0 months !ac" along with Su:lon* has ena!led tapping in to a , %egawatt 'apacity of wind power* with an e0pected generation of appro0imately 1.7 million units of power every year. Technology 2p gradation along with waste heat recovery has resulted in appro0imately <9* 'FDs !eing granted !y 2&C'''. students of the Bovernment Birls 9igh

Page 21

APOLLO TYRES LTD /unlop* South Africa has launched the MAar on Aaste# campaign* a company @wide initiative to responsi!ly dispose all waste generated in factories and offices* in an effective and environment friendly manner. Steam energy to replace use of D1&B under an agreement with BAI1. The pro(ect* !ased on Aaste 9eat Decovery System from BAI1#s Bas Tur!ines e0haust* is conceived as a 'lean /evelopment %echanism >'/%? pro(ect under +yoto )rotocol. This initiative would ena!le Apollo Tyres to generate 7 %A of power and allow the two companies to save around 9<- %illion +ilo 'alories of energy in producing process steam* there!y also avoiding formation of --* tonnes of 'O per 2 annum. Activities are continuously redesigned and shaped to suit the dynamic re5uirement of various programs. Some activities will need to !e managed through e0pert &BO#s. Cor the future* Apollo Tyres aims to further develop its alliances with the !usiness community* educational institutions* social organi:ations and community gatherings to spread awareness and ta"e action.

I%6ra#)r !) ra5 Fa!i5i)i"# P"ramCra P5a%) 74o!'i8

Apollo Tyres# first manufacturing unit located in )eram!ra in +erala and !egan its commercial production in 1977 with a capacity of -7 tonnes. 'urrently the production capacity is 27- tonnes a day. It is manufacturing truc"* 1'.* tractor tyres. The plant is having following certifications; OS $9 ; 199,*2 7 certifications for Ouality %anagement Systems

Degistered with /BSG/ and /efence >'OA.? Degistered with /OT >/epartment of Transportation* 2SA? F'F 'ertification In$%etro >=ra:il? 'ertification SASO >Saudi Ara!ia? 'ertification ISO 9 1 'ertification Initial capacity of the )lant ; 79 tonnes per day tonnes per day F0isting capacity of the )lant; <

&um!er of )eople ;2714>including contract employees?

GOLDEN ACHIEVEMENTS OF THE COMPANY

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APOLLO TYRES LTD Apollo Tyres 1td. )eram!ra unit was ran"ed the first among large scale industries for productivity and energy conservation in the year 2 +erala state in year 2 -G2 7 at productivity council 2$2 < !y

Apollo Tyres received the pollution control award !y the central government during the year 2 2 7 4 <$2 7 -G Apollo tyres received the &ational Safety 'ouncil Award in the year 2

Apollo Tyres ac5uired the Fnergy 'onservation Award in the year 2 Apollo Tyres received the award for Doad Safety in 2 Apollo Tyres ac5uired the Ouality 'ircle Award in 2 Cirst tyre company to get ISO 9 4 4

1 'FDTIIATIO& >Octo1 199-? certification >%arch 2 1?

One of the few tyre manufacturers with OS 9

'onsistently rated as e0cellent in 5uality audit !y colla!oration %IS continental AB %anufacturing facility and tyre testing la!oratory certified !y MInmetro# of =ra:il

BAN4S OF THE COMPANY

State =an" of India =an" of India =an" of =aroda )un(a! &ational =an" State =an" of %ysore State =an" of )atiala State =an" of Travancore I'I'I =an" 1td 2nion =an" of India

A(o55o D"y &i66"r"%)ia)io% )o o)'"r 6irm#

Superior product 5uality Strong !rand e5uity 'ommitted mar"eting team 9igh consumer loyalty Page 2<

APOLLO TYRES LTD )roduct segmentation in truc" tyres =enched mar"ed for planning efficiency parameters )ower consumption Ouic" response to mar"et needs 1east scrap generation.

MILESTONES OF APOLLO TYRES

1972 1977 1971974 1977 19,2 1991 1992 2 < 2 2 2 2 2 2 2 2 7 4 7 7 7 , 9 The companyQs license was o!tained !y %r %athew T %arattu"alam* 8aco! Thomas and his associates. The company was ta"en over !y /r. Dauna5 Singh and his associates. April 1<* )eram!ra )lant Coundation stone was laid down. Apollo Tyre 1td. was registered. )lant commissioned in +erala with 79 T)/ capacity. %anufacturing of )assenger 'ar Dadial Tyre in +erala. The second plant commissioned in =aroda. Ac5uired )remier Tyre 1td. in +erala. F0clusive Dadial capacity esta!lished at =aroda. Dadial 'apacity e0panded to 44 tyre per day. &ovem!er 17* 8oint.enture with %ichelin. 1aunch of Apollo Acelere$ Q9Q Speed Dated 'ar Dadials. April 1<* )eram!ra )lant completes < Eears. 8anuary < * /unlop South Africa is ac5uired. 1aunch /ura Tyre >Detarded Tyre? for the first time in India 1aunch Degal truc" and !us radial tyres 1aunch KApollo Tennis Initiative G %ission 2 1, Announce pu!lic Breenfield plant to !e ready !y 2 1 for the Furopean mar"ets Announce the ac5uisition of .==. Tyres * &etherlands

>Ta!le no <.4? PRODUCT PROFILE TRUC4

Overload Technology 1oadstar Super 1oadstar Super 9ercules Page 27

APOLLO TYRES LTD 1oad G %ileage Technology

1oadstar Super Bold +ai:en - 1 NT 7 NT 7 9aulug NT7 Bold Amar Amar /elu0e 'ommando +ai:en <41 +aisen 99 plus +aisen 77D NT$9 NT9 Bold Amar Bold +ai:en NT/ 'hampion 'hampion /N1 'hampion Bold Amar AT Di! +ai:en 271

)remium %ileage Technology

%ileage Technology Segment

> Ta!le no <.7?

LIGHT COMMERCIAL VEHICLES

1oad and mileage Technology Overload Technology )remium %ileage Technology %ile Star 1oad Super Star Amar /elu0 Amar Bold Di! NT9 NT9 Bold /uramile>radial? 'hampion

Degular %ileage >Ta!le no <.,?

PASSENGER CAR RADIALS

Tu!eless Dadial passenger 'ar Tu!eless Dadial %2. G S2. Acelere Ama:er 10 9aw"s Page 2-

APOLLO TYRES LTD Amar Ama:er N1 Ouantum Tu!e Tyre Dadial Cor Amar %2. G S2. Ama:er N1 Storm 9aw"s )assenger 'ar G 8eep =ias Armour )anther Bripper %aha Trooper >Ta!le no <.9? Tu!e Type Dadials Cor )assenger 'ar

FARM
'ultivation 9aulage %ultipurpose Tractor Trailer Type +risha" Super Sarpanch )ower 9aul Carm +ing >Dadial? +risha" )remium >=ias? /hruv 9unter >Ta!le no. <.1 ?

MAR4ET PROFILE 1. MRF

%DC is the mar"et leader among tyre manufactures in India* with a 27H share in terms of revenues. Its leadership position coupled with its strong !rand recall and high 5uality* %DC commands the price @ ma"er status. %DC has a strong presence in the T G = segment* the largest segment of the tyre industry* and commands around 19H mar"et share in the segment. It is the leader in the 2I< wheeler segment >including motorcycles? and tractor front tyres and holds second place in the passenger cars and tractor @ rear tyres. F0ports accounts for around 12H of the gross sales in the %DC. The company has a distri!ution networ" of 2outlets within India and e0ports within India and e0ports to over 7- countries worldwide.

2. A(o55o Tyr"# 7ATL8

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APOLLO TYRES LTD Apollo tyres is the second largest in the Indian tyre industry* with a mar"et share of 22H in terms of revenues* and largest player in the T G = segment* with around 22H mar"et share and ,2H of its product mi0 coming from this segment. It also en(oys a strong !rand recall. AT1 derives , H of its revenues from the replacement mar"et. AT1 is a strong player in the domestic mar"et* with (ust 2H of sales coming from e0ports.

*. J4 I%& #)ri"#
8+ industries have a 17H mar"et share* in terms of revenue ma"ing it the third largest player in the industry. The company ran"s first in the %9'. and )assenger 'ar Tyre segments with 79H and 7H of its product mi0 coming from these segments respectively. F0ports account for appro0imately 17H of its gross sales.

+. CEAT
'FAT has a 17H mar"et share in terms of revenue and is an average player.4,H of its product mi0 comes from %9'. segment. Its leading !rands in the T G = segment are 1ug N1* %ile N1 and Du! N1* Secure in two wheelers and Cormula @ 1 in passenger radials. In terms of profita!ility* 'FAT has lower margins compared to its peers* in spite of deriving 4 H of its revenues from the replacement mar"et.

-. Goo&y"ar I%&ia
Boodyear India with its presence across the glo!e has a mar"et share of 4H in the Indian Tyre Industry in terms of revenues. It has a significant mar"et share in the tractor tyres segment* with 22H in tractor @ front tyres and a < H share in tractor @ rear tyres. It derives 7-H of the product mi0 from the %9'. segment and <1H from the tractor tyres segment.

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APOLLO TYRES LTD

CHAPTER - + ORGANISATION STRUCTURE

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APOLLO TYRES LTD

ORGANISATION STRUCTURE

'hart no; 7.1

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APOLLO TYRES LTD

CHAPTER 0 , FUNCTIONAL DEPARTMENT

1. PURCHASE DEPARTMENT
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APOLLO TYRES LTD

The main function of purchase department is to provide right material at right time in right place at right 5uantity.

STRUCTURE OF PURCHASE DEPARTMENT

BDO2) %A&ABFD

ASSO.%A&ABFD

ASSO.%A&ABFD

ASSO.%A&ABFD

FNF'2TI.FS

FNF'2TI.FS

FNF'2TI.FS

>'hart no -.1? This department is concerned with the purchase of !oth indigenous and imported materials. It covers procurement of indigenous Fngineering and miscellaneous items other than raw materials. This department is headed !y senior manager and under him there are a num!er of officers and staff. The department is provided with the latest communication facilities and computers. The main items of purchase are; Fngineering spares 'onsuma!les Curnace oil /iesel 'hemicals 1u!ricants Some raw materials

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APOLLO TYRES LTD The purchase may !e corporate purchase or plant purchase. 2nder corporate purchase the raw material is purchased after considering what the mar"et re5uire for the month. 2nder plant purchase* purchase may !e of stoc" item or of non stoc" item. Stoc" items are purchased for regular use. They are having material codes. They are purchased after considering the reordering level* reorder 5uantity* lead time etc. Cor non stoc" items there is no regular purchase. /ifferent departments have to prepare purchase re5uisitions. The items purchased are engineering items* oils and lu!ricants* local raw materials* import of spares etc.

OCE"!)i:"#;$
To ensure continuous availa!ility of material. %a"e purchase at most economic price. /evelop good supplier relation. Fnsure alternate source of supply Fnsure 5uality products to reduce wastage and material loss.

1. )urchase re5uisition is formed Ahat re5uired Ahere re5uired 9ow much re5uired

2. .endor analysis !ased on Ouality )rice Time of delivery

P r!'a#" Pro!"##;1. Deceiving purchases re5uirement. 2. Fnsuring sources of supply and choosing suppliers. <. )reparation and e0ecution of purchase order. 7. Deceiving and inspecting of materials. -. 'hec"ing and passing of !ill of payments.

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APOLLO TYRES LTD

V"%&or #"5"!)io%
This includes a list of steps involved in selecting the right vendor for stac" items identified as critical !y the department to ena!le a smooth functioning of the plant. .endors are generally identified as 1. %anufactures 2. /ealers <. Cirms offering various services %anufactures are divided into two

1. OME7Ori?i%a5 E> i(m"%) Ma% 6a!) r"

The O%F shall !e identified as a vendor for the supply of e5uipment* spares* components etc.

$. OCM 7Ori?i%a5 Com(o%"%) Ma% 6a!) r"#8;

Cor all spares* components and consuma!les* attempts are made to identify the manufacturer and source the items directly from them so as to get 5uality products or services at optimum cost. Information availa!le on supplier#s manuals* catalogs* details availa!le on the nameplates of machines etc shall !e used for the purpose. The capital purchases and raw material purchase is done through centralised purchasing i.e !y the corporate office situated at &ew /elhi. Fach item of the engineering stores will have a serial num!er along with code num!er. They are identified with that num!er. The products to !e purchased are automatically generated !y the help of computer and this process id called %D) >%aterial De5uisition )lan?.A reorder level will !e fi0ed for each and every item >spares? and whenever the stoc" is !elow the reorder level the %D) will !e run and the order is placed to the vendor >supplier?. The purchase order will !e placed for the total 5uantity i. e if the stoc" is 1 and the reorder level is 7* out of which , were ta"en to the plant then the order will !e placed for entire 1 items and not !alance , items. At this stage the stoc" will !e a!ove the actual stoc" i. e 12 as a!ove situation. Ahen the goods for purchase are without product code then these items are purchased when the re5uired departments will have to place the order manually. The purchase department will ta"e decision on such purchase order !y calling a meeting. Page <<

APOLLO TYRES LTD And if the decision is ta"en regarding the order then a tender will !e issued for the purchase of goods. The lowest rate 5uoted will !e fi0ed. The products so purchased will have to !e collected !y respective departments manually from the factory gate >other purchase items i. e items with product code will !e unloaded at respective departments?. On receipt of the goods the respective department will have to prepare a goods receipt >BD? and should !e send to purchase department.

PURCHASING RECORDS
)urchase Order Decords .endor Decords =lueprint and Specification Decord /rawing 'ontract Ciles Decord pf all materials purchased 1ist of all vendors* their mailing address* and other details. %any items are purchased !y !lueprint specification and are "ept in separate files with inde0 showing their location and where the copies have to !e send. 'ertain goods may !e !ought under a term contract. In such cases the purchase department must maintain a record of such contracts. Ta!le no -.1

2. STORES
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APOLLO TYRES LTD

FLO1 OF AUTHORITY
DA&+ 1 2 /FSIB&ATIO& %anager Associate %anager Stores /2TE TO =F )FDCOD%F/ %anagerial functions 'oordinate all activities of various stores li"e D%S* CBS A&/ F%S. 'oordinate with transporters supply chain management of /elhi depot* < 7 Sr. Officer stores 8r. Officer 8r. Officer Ta!le no -.2 e0cise and OF customers. /espatch and receipts of in and out various materials. Deceipts and related documentation of incoming materials /espatch documentation and account "eeping

RA1 MATERIAL STORES

Pro!"##;$Deceipt handling* stores* pac"aging* forwarding and delivery of material to internal and e0ternal customers with proper documentation to meet their re5uirements. P r(o#";$To supply right material in right time to produce right 5uality product without any interruption. S!o(";$Deceipt* handling* storage and issue of raw materials and to the customer.

SIPOC
S @ Supplier R 'orporate purchase. I @ Input R Daw materials. ) @ )rocess R Deceipt handling* storage* preservation G issue of raw materials. O @ Output R 'onfirming D% receipt* storage G delivery. ' @ 'ustomer R %anufacturing* mi0ing centres other unit of AT1 G internal customers.

RA1 MATERIAL HANDLING PROCESS

1. .erification of documents at security gate @ The security officers will chec" the various documents li"e Page <-

APOLLO TYRES LTD Serial num!er Suppliers name /escription of item Truc" registration num!er /ate and time of arrival /ate and time of departure

2. Aeightment of the truc" is ta"en after passing the gate. A computeri:ed weighment machine is maintained. <. .erification of documents at the Daw %aterials Stores @ .arious documents su!mitted at D%S will !e e0amined and verified* which includes delivery 'helan* sales ta0 papers* e0cise papers* pac"ing list* duplicate copy for transporters of invoice for availing modvat credit. 7. Testing @ The various raw materials are tested at the la! and only then the raw materials will !e unloaded on the plant store or in the tan"s. -. 9andling and storage @ All materials e0cept materials in tan"ers will !e unloaded manually. 'aged pallets or platform pallets are use for storing of raw materials. Fach caged pallet will carry a ma0imum of 1"g of materials. Those items in the tan"ers will !e directly unloaded to respective tan"s. 4. )reservation @ The various raw materials are preserved as follows; 'ar!on !lac" and chemical are stored in 2nd floor. &atural ru!!er* wa0 etc stored in 1st floor. Ca!ric* !ead wire* late0 etc stored in ground floor. %aterials received in tan"ers will !e pumped in storage tan"s.

7. De(ection @ If the items are tested are displayed with a re(ected tag !y the technical department then if the item is small 5uantity then it will !e "ept in re(ection area and if the 5uantity is large it will !e "ept in the same area till the disposal.

VARIOUS RA1 MATERIAL USED IN THE MANUFACTURE OF TYRES

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APOLLO TYRES LTD )O1E%FDS @ &atural ru!!er* synthetic ru!!er* car!on !lac"* reinforcing clays Cillers 'uring agent )rocess oil 'uring agents I sculpture Accelerators I activators Antio0idants I antio:onents >wa0es? Det ardors )epticers for natural ru!!er mastication Det order =ead wire Ca!rics spools Solvent for cement and solutions %iscellaneous items li"e paints* colour* crayon* scrap fla"es etc.

Pro!"& r" 6or 'a%&5i%? o )#i&" miFi%? o("ra)io%#

P r(o#"; To define a procedure for identifying sources of e0ecuting contracts* arranging for transportation and maintenance of records. S!o("; All operation regarding outside mi0ing to !e carried out !y stores department are consolidated in the )rocedure. R"#(o%#iCi5i)y; 9ead of the /epartment. R"#o r!"#; %i0ing 'entres* Stores /epartments* Technical production planning control and production.

RECEIPT OF RA1 MATERIALS

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APOLLO TYRES LTD

VERIFICATION OF DOCUMENTS AT SECURITY GATE

The security inspector at main gate shall verify all documents pertaining to the consignments !rought to the factory !efore allowing entry in to factory premises and note the following details. Serial no* suppliers name* description of item* 'hallan 5uantity* challan 5uantity* challan no and date or 1D no and date* truc" reg no* date and time arrival* date and time departure.

1EIGHMENT 7BY THE COMPUTERISED 1EIGH BRIDGE8

Security shall inform raw material stores a!out the arrival of the vehicles at the gate. The security guard and a representative from D%S shall record weighment of truc" (ointly. The weighment slip shall indicate the following; Serial no* time and date of receipt* suppliers name* gross weight with materials* SID no and date. After recording the a!ove details in the computerised weighting !alance the vehicles shall !e directed to the respective unloading !ay. In AT1 weighment will !e done in a weigh!ridge closer to the factory under the supervision of security and D%S personnel after ensuring that the weigh !ridge posses a valid certificate from weight and measure department. =oth security and D%S personnel shall sign on the computerised weighment slip. One copy of the weighment slip will !e filed in D%S along with concerned delivery challan and the second copy will !e returned !y security department.

VERIFICATION OF DOCUMENTS AT RMS

The receipt in charge shall verify the documents to ascertain the no of pac"ages* description of material code and weight of the material. If any discrepancy is found the same shall !e orally reported to the officer concerned !efore unloading. 9e in turn will ta"e decision suita!ly. The dispatch documents include; /elivery challanI invoice* sales ta0 papers* pac"ing list and duplicate copy for transporters of invoice for availing %O/.AT credit. In case of non receipt of any of the a!ove documents the consignment will not !e unloaded unless and otherwise instructed !y the competent authorised after compliance of all conditions stated a!ove* the materials will !e unloaded as instructed !y the receipt in charge and lead to the respective area.

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APOLLO TYRES LTD

HANDLING STORAGE AND PRESERVATION

All the incoming materials e0cept the materials coming in tan"ers will !e unloaded manually or with the help of for"lift as instructed !y the receipt in charge. 'aged pallets or platform pallets are used for storing of materials so far as possi!le to facilitate easy handling at the time of issue. Fach caged pallets will carry a ma0imum of 1"g of materials. 'aged pallets will !e stac"ed one over the other.

PRESERVATION
'ar!on !lac" and chemicals are stored in the 2nd floor* natural ru!!erI S=D* wa0 etc in the 1st floor and fa!rics* !ead wire* late0 etc in the ground floor. In case of space constrains in the respective floors* the respective floors* the materials may !e "ept in the ground floor and other places as directed !y the storage in charge. %aterials received in tan"ers* after chec"ing the seal and dip reading and sample test !y OA will !e directly pumped into the storage tan". =efore unloading the receipt in charge will ma"e sure the availa!ility in the storage tan". De(ection items are identified !y displaying a re(ection tag !y technical department. In case of re(ection of voluminous 5uantities the materials are "ept in respective areas till disposal* while small 5uantities will !e removed and stored in the re(ection area duly displayed with the re(ection tag.

ENGINEERING STORES DEPARTMENT

Fngineering goods stores is responsi!le for storing the necessary spare parts* components re5uired for smooth functioning of the plant. On receipt of indent from production department* the engineering stores arrange for its release. The inventory management techni5ue used is .F/ Analysis. Almost all the activities of this department are computeri:ed. The purchase department is initiated whenever reorder level is reached. A !uffer stoc" is always maintained in the store. Another system followed in the engineering stores is .%I @ .endor %aintain Inventory. In this the vendor supply the raw material in large 5uantities and payment is made only for consumed items. The engineering store "eeps record and stoc" of engineering materials and consuma!les. The actual stoc" and item list are maintained !y the computer. The Page <9

APOLLO TYRES LTD various types of items in the engineering store are tools* glows* mas" etc which are re5uired for the wor" to progress. A reorder level is maintained for each item and when the stoc" is either e5ual or less than the re order level the computer will automatically place the purchase order !y running the %D) >material re5uisition program?.The purchase department will see to it and place s the order to the regular suppliers. If new suppliers enter the mar"et the !est 5uoted price will !e ta"en. The materials to the engineering department will !e sealed !y the security at the gate and the actual stoc" and order will !e verified. If the materials received is correct the goods received receipt is prepared and sent to the purchase department. If there is any shortage then it is also informed to the purchase department.

ENGINEERING MATERIALS
The total num!er of item codes in engineering stores is <,out of which 2<are spares and 1are consuma!les. appro0imately*

1. Co%# maC5"# 7G"%"ra5 #)or"# i)"m#8

'onsuma!les >Beneral stores items? are standard engineering items >!earing* !elt etc?. It is decided to identify common codification scheme for all consuma!le items. All the items shall !e !rought under this codification scheme.

$. S(ar"#
Spares are parts of e5uipments. F5uipments are varying from plant to plant !y ma"e and model. It is decided to Identify common e5uipment !y same ma"e and model. Assign uniform code to e5uipment ma"e and model wise* which is common across plants. Assign representative plant spares with code of e5uipment. In general the item code for consuma!les will !e common across all plants and item codes for spares will !e plant specific with respect to common e5uipment code. %aterial classification in SA) will !e used to trace the spares to common machines. %aterial master codification will follow the e0ternal num!ering

FINISHED GOODS STORES

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APOLLO TYRES LTD Cinished goods stores >CBS? is the place where the final goods are stored from where these are ta"en away from the plant. All finished goods after final inspections are "ept at the transferring area in each shift. The staff of final finishing will prepare a finished goods transfer note in triplicate which will !e countersigned !y the staff of CBSI TTC. After verification finished goods transfer note will !e serially num!ered and have the following details. %aterial code /escription Ouantity The original copy of the transfer note will !e issued to central e0cise wing after entering the details in stoc" statement* duplicate will !e given !ac" to the production as their file copy and triplicate will !e issued the production planning. One staff each from production and CBSI TTC will separately verify 5uantity* si:e* ply rating

R"mo:a5;
The finished goods re5uired for dispatch "ept at the transferring area* after preparing the transferring notes* will !e removed to the loading !ay and !alance will !e removed to stores for storage* after completing pac"ing for re5uired item. The various processes to !e performed for handling* preservation and storage are listed !elow; a? Application for &on @ OD >&on Original F5uipment? Cinished goods stores is fully covered and protected from sunlight and rain water. Tyres are rolled from transferring area to the stores and stored on si:e wise. Fach stac" with ma0imum of ten for truc" tyres* , for DT and 12 for 1TIpassenger. All tu!es are pac"ed in 9/)F !ags and !ought to the storage area directly !y tu!e production. Claps are !undled and transferred using trolley. All seconds tyres stored in CBS are identified using a white !and and tyre using a red !and. A stoc" statement is made as on the closing of the day. This is made !ased on the receipt and despatch. After preparing the stoc" statement the finished goods transfer note is transferred over to factory e0cise wing for recording and filling. Page 71

APOLLO TYRES LTD !? Application for OF >Original F5uipment? Truc" OF tyre if not despatched within 27 hrs should !e stac"ed in the warehouse. =ottom most tyre will !e stac"ed with tu!e value facing upwards and for others with tu!e value facing downwards >same practice is followed while loading the tyre in truc" also?. CICO system is followed Truc" inspection is carried out !efore loading the tyres. In case of higher inventory levels it is not possi!le to store all the tyres in the godown* temporary sheds will !e restored for storing those tyres. Stoc" levels of CBS are controlled !y supply chain management at head office level.

/ISTDI=2TIO& OC CI&IS9F/ BOO/S

%ain responsi!ility is for the head of department. Supply chain management department give the despatch schedule day to day !asis. /estination to which truc"s are re5uired is arranged day in advance. 1oad slips are prepared as per the plan made. Stores men will "eep the loads as per the load slips at the loading !ag. Staff of CBS* security and representative of transported will chec" the loads. After chec"ing the load* slip will !e signed !y the staff and given for preparing transport documents and goods will !e loaded on to the 1orries. The lorries will !e inspected for cleanliness of the platform to ensure that there are no items which will damage or dirty the tyres. All truc"s are despatched to outstation are covered using tarpaulin and tied safely !efore leaving the factory premises /espatch documentation is made. Sales ta0* road permit are handed over to the transporters. Invoice distri!ution

a? Original @ =uyers !? /uplicate @ Transporter c? Triplicate @ Assesse d? Ouatriplicate @ F0tra copy 1ist of serial num!er of tyres !eing despatched will !e provided when ever necessary.

Page 72

APOLLO TYRES LTD All documents re5uired for transportation are prepared and handed over to the transporters after getting paper ac"nowledgement and lorry receipt from him. All finished goods after final inspection are "ept at the transferring area in each shift. The staff of final finishing will prepare a finished goods transfer note in triplicate which will !e countersigned !y the staff of CSB. After verification finished goods transfer note will !e serially num!ered and have the following details; Deceipt %aterial 'ode /escription Ouantity Demoval The original copy of the transfer note will !e issued to central e0cise wing after entering the details in stoc" statement* duplicate will !e given !ac" to production as their file copy and triplicate will !e issued to production planning. One staff each from production and CSB will separately verify the 5uantity* si:e* ply rating of the finished goods and compare against the entry in the transfer note. The finished goods re5uired for dispatch "ept at the transferring area* after preparing the transferring notes* will !e removed to the loading !ay and !alance will !e removed to stores for storage* after completing pac"ing for re5uired items.

Page 7<

APOLLO TYRES LTD

*. HUMAN RESORCE DEPARTMENT

9uman Desource and Administration department is one* which facilitates smooth wor"ing of the organisation !y loo"ing into the human resource side and also the overall administration of organisation. 9D department is divided into three sections namely Industrial and )ersonal Delations* Security and Administration. 9eads of each section are in direct contact with the department head. Among the three sections Industrial Delations is the !iggest section having four su!sections loo"ing into )ersonnel and Industrial Delations* Fmployees Arrival and /eparture* Time * 9ealth and Safety.

VISION OF HR DEPARTMENT
Our 9D vision is to !e a strategic partner to the !usiness and create value for the organisation !y developing the human capital.

MISSION OF HR DEPARTMENT
To create 9D policies and process which are employee friendly. To !uilt a culture which is warm forthcoming and professional with a sense of ownership and pride. To encourage innovate thin"ing. To encourage transparency and teamwor". To develop leaders at all levels with general mar"eting s"ills. To create a learning organisation. To develop competencies and s"ills through training and development. To constantly raise levels of employee productivity. To create 9D !rand.

Page 77

APOLLO TYRES LTD To wor" towards a attaining and sustaining the !est the !est employer status.

STRUCTURE OF HR DEPARTMANT

9AF/ @ 9D G A/%I&ISTDATIO&

BDO2) %A&ABFD$9D %A&ABFD $ 9D

%A&ABFD A/%I&ISTDATIO&

FNF'2TI.F

FNF'2TI.F

ASSO'IATF %A&ABFD

ASSO'IATF %A&ABFD

ASSO'IATF %A&ABFD

FNF'2TI.F

FNF'2TI.F C'ar) %o ,.$

FNF'2TI.F

FNF'2TI.F

The ma(or functions of 9D /epartment 1. Decruitment. 2. Selection. <. Training. 7. Industrial Delations. -. Aelfare. 4. Time office. 7. Security and Safety.

Page 7-

APOLLO TYRES LTD

1. RECRUITMENT
Decruitment is done through advertisement and a good opportunity is given to the child of wor"er. This increases family loyalty towards the company. They are call for the interview and the 'hief e0ecutive ta"es the final decision.

$.SELECTION
a. Ma%a?"m"%) #)a66. Technical @ =. Tech* Braduate Fngineer trainee. &on technical @ 'AII'AAI%SAI%=AI%A >)%?; F0ecutive Trainee. After training* they are a!sor!ed as officer. 'riteria include. 'onsistency in academic performance. Broup discussion. )ersonal interview.

C. Em(5oy"" !'i5&r"% #Di55 &":"5o(m"%) #!'"m". Three year production apprentice. One year training in production. /ependant of employees. %inimum 5ualification $,th standard. )hysical fitness >height$14,'m* weight$- +g? .

!.I%&!)io% P5a%. Aor"ers Associate managers $ $ 2 days induction training. 7 days. Page 74

APOLLO TYRES LTD %anagement staff $ 1- days to 1 month.

*.TRAINING
The organisation provides training for !oth managers and wor"ers. Training program for managers consist of !oth internal and e0ternal program. A three dimensional s"ill frame wor" is used to identify the training needs of wor"ers as conceptual s"ills* functional s"ills and human s"ills. T'" )rai%i%? #y#)"m i%!5 &"#G &eed identification. Setting o!(ectives. Training design. Training implementation. Training evaluation. Training impact assessment.

Ar"a# !o:"r"& i%!5 &"; For ma%a?"m"%) #)a66. 'onceptual. Cunctional. 'ross$functional. =ehaviour.

For @orD"r#. Systems. Technical aspects. Aor" culture. Specialised training for trade unions.

Page 77

APOLLO TYRES LTD

TRAINING AND DEVELOPMENT PROCEDRE

Training and development of AT1 )eram!ra aims to accomplish the following o!(ectives; To e5uip the personnel with conceptual* functional and !ehaviour s"ills those are necessary to perform the (o! at hand. To provide a nature for the wor" is to down of an individual where in heIshe can e0plore and optimally use hisIher innate and talent potentialities leading to hisIher individual growth and development. To create a culture of continuous leading among the all employees through systematic training with the ultimate o!(ective of ma"ing AT1 a performance driven organisation.

TRAINING RECORDS
< types of training records will !e maintained !y 9D /epartment. Trai%i%? !ar&#. The training card will contain the details of all training programme that are attended !y an individual employee. The card will !e maintained in the prescri!ed from CD$ 4$A$ 7. Or?a%i#a)io%a5 )rai%i%? (ro?ramm" mo%i)or. In order to consolidate and mention various training programme conducted* an organisational training programme maintained as per from CD$ 4$ A$ Individual training programme monitor. Cor those programmes attended !y more than - individuals* the list of participants will maintained in the individuals training programme in the prescri!ed from CD$ 4$A$ 4. Page 7,

APOLLO TYRES LTD

TRAINING PROGRAMMES.
Training on communication and interpersonal s"ill programmes for associate managers and managers. Training on 8yotirgamaya for !lue collared employees. Safety and fire training conduct for !lue collared wor"men. Aith a view to develop multi s"ill among engineering trainees* they are given e0posure to engineering* production and technical fields.

TRAINING

IN

THE

FORM

OF

THEME CENTERED

INTERACTION. JYOTIRGAMAYA;
On each wor"ing day a!out 4$7 employees are selected for training in a classroom atmosphere* a!out the productivity* 5uality G scarp reduction. The employees are provided training specialty a!out the company and the tyre industry in general. 8yotirgamaya provide information regarding the changes happening in the industrial field. It#s o!(ective is to give training for all the employees in the unit within a period of 1 year.

SIH SIGMA ;7 introduced on April 14th 2

7?

Si0 sigma is !asically meant for increased production and for running the organisation profita!ility. I t is for finding out areas where unneeded e0penses are occurring and for reducing. It using scientific techni5ues with a disciplinary approach. A si0 sigma organisation means the defects in the production of 1 la"h parts must !e !elow <.<7H. Ahen the employees !ecome aware of si0 sigma and they come into contact with the machineries Page 79

APOLLO TYRES LTD used for this* then the organisation will achieve an une0pected growth. This helps to find out the defects in production and for finding out remedy. It also helps to understand the fact that consumers are the owners and also to produce 5uality products.

+. INDUSTRIAL RELATIONS
There e0ists a good relation in the company. The management and the employees (ointly find the solution for the pro!lems. There e0ists a well maintained relation !etween the employees and employers.

Tra&" U%io%#
ATEU - Apollo Tyres Fmployees 2nion. AT1M- Apollo Tyres Aor"ers %ovement. ATS1U-Apollo Tyres Staff and Aor"ers 2nion. ATMS -Apollo Tyres %a:door Sangh.

,. 1ELFARE
The organisation provides good welfare services to its employees. The company runs a su!sidised canteen on contract !asis. Dest rooms with loc"er and washing facility* arts and sports clu!* and well maintained li!rary are other facilities provided. A well transportation facility is given to all the employees from different destinations for which they have to pay a very less amount. All employees drawing a salary !elow Ds.4 policy and medi claim policy. The various schemes for the employees are; 1. Fmployee deposit lin"ed insurance scheme. 2. Aor"men#s compensation scheme. <. Broup hospitalisation scheme. 7. 'anteen facilities. -. Transportation facilities. Page are covered under group accidental

APOLLO TYRES LTD 4. 9ousing loan interest su!sidy and so on. Ta"ing the health aspects of employees those who in the night shift get 2 ml of mil" pac"ets. It is given to retain their lost energy in the night shift Apart from its soaps is distri!uted for the cleanliness of employees. Fach wor"er gets soap fully off cost and those who wor" in their production units < in num!er per month. 1"56ar" a!)i:i)i"# ar" o6 $ )y("#G Statuary. Settlement grievances. and give motivation to the employees to come for night shifts.

S)a) ary @"56ar" a!)i:i)i"#. FSI Bratuity

Som" o6 )'" #"))5"m"%) ?ri":a%!"# ar"G Gro ( Sa:i%? Li%D"& I%# ra%!" S!'"m" 7GSLIS8. Gro ( P"r#o%a5 A!!i&"%) I%# ra%!" S!'"m" 7GPAIS8. Gro ( M"&i!5aim I%# ra%!" Po5i!y 7GMIP8.

Ma%a?"m"%) #)a66 Broup hospitalisation scheme. Broup personal accident policy. Two wheeler scheme @ 7 H !orne of the company. 'ar scheme @ Asst. manager G a!ove $ 7 H !orne of the company. Super annuation @ Asst. manager and a!ove. Fmployee self development scheme.

1orD"r# Broup personal accident policy. Page -1

APOLLO TYRES LTD %edical claim. 9ousing loan interest su!sidy$- H. 2 wheeler interest su!sidy$7 H. Cinancial assistance co$operative society. )eriodically medical chec" up. The aim and o!(ective of welfare fund shall !e to render financial assistance and to encourage cultural* sports* social games and other welfare activities among them a spirit friendship * co$operation and understanding.

-.TIME OFFICE
This is concerned with registering the time in and out of the wor"ers. Other activities related to payment of wages* incentives* leaves etc..../ifferent registers are "ept for different shifts for the effective functioning. A leave !oo" is maintained G it contains* 1eave !alance. 1eave credited. 1eave waited.

The daily attendance reports for the employees specify the following; SectionIdepartment. Shift. /ate. 'loc" no. Brade. 9ours wor"ed. Schedule shift. Apart from it * a punching system is maintained. Fach employee has to punch his !adge in the electronic punching system while arriving for duty. The same is repeated while leaving the factory premises. Page -2

APOLLO TYRES LTD Attendance is cross chec"ed with the attendance report of the wor"man and the attendance register maintained at various sections for the staff and managerial persons. )erformance reports are maintained at various sections for the staff and managerial persons. )erformance reports are maintained in each section. These are done with a view to reduce the a!senteeism in employees and motivate them to increase production. A leave !oo" is maintained and it contains leave !alance* leave credited and leave awaited. The daily attendance report is verified !y the superior * shift engineer and shift superintendent department head. SHIFTS OF 1OR4ERS Shift A B C D7G"%"ra58 4am$2pm 2pm$1 pm 1 pm$4am 9am$-pm Aor"ing hours

>Ta!le no -.<?

..SECURITY AND SAFETY S"! ri)Y

The security is concerned with the physical movement of men and material. Security staff headed !y the chief security officer wor"s at all the shifts. To facilitate the security measures* single point entry is adopted to control visitors. Cor materials* separate gate passes are issued. JoC &"#!ri()io% ;-

Page -<

APOLLO TYRES LTD =e responsi!le for security of men* machinery * finished goods* raw materials * process materials * highly sophisticated e5uipments etc.... Their inward and outward movement is monitored as per the system prevailing. /evelopments of security staffs in line with the re5uirement of the organisation and to "eep a high morale of the forces.

Pri%!i(a5 a!!o %)aCi5i)i"# o6 !'i"6 #"! ri)y o66i!"r. 1. %onitor and control all inward and outward movement of vehicles * material and personal. 2. /eploy of contract wor"force to various department for routine as well as pro(ect wor". <. %aintain the data !ase of all indirect wor"force including contract wor"men. 7. Fnsure high degree of liaison with police * local administration * fire force and government authorities. -. 2p"eep of environment management system * including house"eeping of plant. 4. +eep strict vigilance * gather and assimilate intelligence for smooth functioning of the plant in an unionised environment.

E:"%) ma%a?"m"%);The security department plays a significant role in factory day* safety day* OnamI'hristmas cele!rations and plant visit !y important officials.

Safety
The organisation follows all the provision under the Cactories Act 197,. The plant is well e5uipped with safety machines and directions are given for the same. Safety directions are placed at noticea!le points in and around the plant premises. Cire e0tinguishers are placed reacha!le points and employees are well trained to use if necessary comes. Those who wor" in production

Page -7

APOLLO TYRES LTD department are given mas"s * safety gowns and shoes. In Apollo * a separate !oo" is given to each employee * which prescri!es certain rules and procedures in order to create a wor"ing environment free of accidents. &o ma(or accident was occurred in the plant for past 1 years. A=' of safety A$Always =$Be '$Careful FIRST AID M"&i!a5 o66i!"r

;-

There are 2 doctors in Apollo Tyres 1td* )eram!ra plant to cater to the medical needs of the company. One among them is a general surgeon . The various services provided !y the medical officers are listed !elow. a? 'ausality services @ The main purpose is the causality function. The in(ured will !e provided first aid !y the medical officers. All the facilities availa!le within the company will !e utilised and when further treatment is re5uired the patients will !e referred to near!y hospitals. If the in(ured re5uire any leave or rest * then a !rief investigation report will !e prepared and su!mitted. !? %edicines @ =asic medicines will !e availa!le in the first aid counter itself and other medicines will !e prescri!ed to the patients to !e purchased from outside. c? Decord "eeping @ A chart called the M1 chart# is maintained for the

employees where all details regarding the various diseases of the employee will !e recorded. d? Advisory services @ Advisory and counselling services are provided the

employees with regard to their physical as well as mental pro!lems. e? 'lasses and Seminars @ %edical officers conduct classes and seminars

regarding the harmful effects of alcohol * drugs * smo"ing etc... and ma"e them understand the ways in which this will affect the health of the company. f? )osture and e0ercises - A healthy mind and strong !ody is re5uired for

the company to perform successful. The 5uality of wor" depends on the Page --

APOLLO TYRES LTD individual. Therefore the medical officers also advices regarding good posture to !e maintained* e0ercises to !e performed to maintain !ody and mind healthy and activity Em"r?"%!y (5a%;Fmergency is a situation warrented to see" e0ternal help or resources for controlling an eventuality which adversely affect the environment * man and material or o!(ectives of emergency plan are to assign the individual roles and duties to perform in an emergency situation. a? !? c? To avoid panic and confusions. To effective utilise the availa!le resources. To e5uip them. =ut if the facilities not enough * then advance intimation shall !e passed to hospitals for immediate receipt of patients. The procedures to !e performed for such a situation are listed !elow; a? The details of the causalities that are ta"en to the hospitals will !e intimated to the welfare officer. !? 9e will also inform the Apollo Tyres 1td head * engineering head * 9D

and administration head * finance head * safety manager * security manager and medical officers over the phone. c? Aelfare officers shall co$ordinate with hospital to give utmost care and

attention to the victims. Incident controller shall prepare a !rief accident report >CID? to !e su!mitted to the management immediately after the situation has come under control. OTHER ADMINISTRATIVE ACTIVITIES 1. Selection )rocedure. 2. Induction )lan. <. )erformance Appraisal. Page -4

APOLLO TYRES LTD 7. A!senteeism %anagement. 1. S"5"!)io% Pro!"& r" a. Ma%a?"m"%) #)a66. Technical ; =.Tech* Bradate Fngg Trainee &on$Technical ; 'AII'AAI%SAI%A>)%?;F0ecutive Trainee After @ trainee a!sor!ed as officer criteria 'onsistency in academic performance Broup discussion )ersonal interview

!. Fmployee children s"ill development scheme 1 year training in production /ependents of employees %inimum 5ualification @ ,th std )hysical fitness $.I%& !)io% P5a% Aor"ers ; 2 days induction training %anagement staff ; 1- days induction Ouality )ledge Safety procedure Aelfare measures Interaction with all department heads *.P"r6orma%!" A((rai#a5 Fmployee /evelopment Deview>April$%arch? Three @ Tier system 9elps in setting individualIteam goals

Page -7

APOLLO TYRES LTD Dated in respect of the achievements %id @ year review of the goals )ersonal attri!utes considered +.AC#"%)""i#m Ma%a?"m"%) A!senteeism among wor"men has !een a cause for concern for the companyS production has suffered heavily in this account recently. It has therefore !een decided to fight against the a!senteeism contains among the regular wor"men and production apprentices through attendance monitoring mechanism. The control measures are a. A))"%&a%!"I Di#!i(5i%" 2 D":"5o(m"%) Pro?ramm" Introduction of A// programme effective in AT1 An effort to improve the attendance of chronic a!sentees To maintain consistent production Operations of the scheme o 'hronic a!sentees num!ering 192 are !rought under small group of - person. o 192 wor"men are !rought under 2< groups* under each mentor* drawn from purchasing and other financial areas* on a daily !asis oversee attendance to ensure availa!ility of his group mem!ers for wor". o 9D department monitor the attendance and stops those who a!sent from duty continuously for < days. o After 1-th of each month* attendance data of the group mem!ers are generated and circulated among the groups. o 9D department pu!lishes list of a!sentees during 1st half of the month to give them a chance for improvement during the second half of the month.

Page -,

APOLLO TYRES LTD o In the 1st half of the succeeding month* the attendance for the previous month is pu!lished and committee meets and decides the course of action against defaulters. o AdvisoryIwarning IsuspensionIpending en5uiry etc... are issued !ased on the gravity of each case. o Individual appreciation letters signed !y the mentors are sent to the residence in cases where remar"a!le improvement is shown.

C. Sy#)"m o /aily follow up o < days @ meet 9D o 4 days @ stoppage o 1 days @ home visit o 2 days >accident? home visit !. Ta#D 6or!" o 'onstitution >19D L11ine )ersonnel? o 12 tas" forces for 114 mem!ers o Achievements ; 1 a!sentees were covered to 1 o Individual )ro!lem solving o <7H ha!itual a!sentees shows improvement &. Trai%i%? a%& !o %#"55i%? o 2 days training module o Individual counselling ". L"a:" P5a%%"r Page -9 H attendance

APOLLO TYRES LTD o 12H permissi!le limit or wor" station o Cestival leave plan o 1eave sanctioning and monitoring Sa5ary Paym"%) All supervisory personnel are re5uired to open a S= account with South Indian =an"* )eram!ra and intimate the accounting department who in turn will remit the salary. In case of non @ supervisory personnel cash payment is done in the following daysS Staff and service staff @ 1ast wor"ing day of the month. )roductionIengineering @ 7th wor"ing of the succeeding month. Em(5oy""# 6o! # 7SHE8 1. Sa6")y A#("!)# ; Primary im(or)a%!" $. H"a5)' Cull time doctor Am!ulance /ispensary %edical chec" $ up

*. E%:iro%m"%) Fco @ friendly surrounding )ollution free wor" practice

B #i%"## 6o! # )roduction lin"ed !onus )roduction lin"ed 1TS>1ong Term Settlement? 6ero over time Page 4

APOLLO TYRES LTD F0pansion of capacity Dight si:ing

Promo)io%
)romotion is purely !ased on attendance * seniority and performance. They are all recorded in a systematic way. There is computerised punch card system followed in the company. Fach entry and e0it to the plant is recorded. Apart from this is a well maintained payroll system too. A!senteeism is !eing found out and proper reasoning is o!tained. The attendance of the wor"ers also account for their promotion. Thus 9D department is the strongest department of Apollo Tyres 1td * )eram!ra* which have seven su!sections which are mentioned a!ove. It has a well esta!lished industrial relation and this department gives more important to the welfare and safety of the employees * also the time management is very good here. All these sections are under the direct control of the 9D %anager.

Page 41

APOLLO TYRES LTD

7. PRODUCTION DEPARTMENT

MANUFACTURING PROCESS
)roduction department is re5uired for the operation* maintain 5uality and optimum level of production department of AT1* )eram!ra consist of 2 :ones* namely :one 1 and :one 2.All the production activities are classified under these two :ones. The production planning starts with receipt of production tic"et from /elhi which contains the 5uality re5uired for !ranches. The re5uirement is then processed in the planning department and then converted into e5uivalent for production* and then the production schedule is finali:ed.

STRUCTURE OF PRODUCTION DEPARTMENT

)DO/2'TIO& 9FA/

/I.ISIO& A 9FA/

/I.ISIO& = 9FA/

/I.ISIO& ' 9FA/

FNF'2TI.FS

FNF'2TI.FS

Page 42 FNF'2TI.FS

APOLLO TYRES LTD

FNF'2TI.FS

FNF'2TI.FS

FNF'2TI.FS

>'hart no -.<?

)DO/2'TIO& )DO'FSS

=an!ury mi0er

%ills

/ip unit

'alander

/ual e0truder

=ias cutter

Thread s"iver

=rand !uilding

Thread

Tyre !uilding

=ead !uilding unit

Tyre curing Tyre !uilding

Page 4<

APOLLO TYRES LTD

)ost cure inflation

Cinal inspection

Aarehouse

>'hart no -.7? Daw materials used in the manufacturing process %ain raw materials used for the tyre manufacturing are* %aterials used for various ru!!er components. %aterials used in for tyre reinforcement. Au0iliary materials.

%aterials used in ru!!er components The essential ingredients in ru!!er components are as given !elow; Daw ru!!er or natural ru!!er. .ulcani:ed ru!!er 'ar!on !lac" 6inc o0ide Accelerators Activators Deinforcing agents )rocess oils or Aromatic oils >ma"es easy the mi0ing? Anti @ degradents Anti @ o0idants Cillers )rocess aids Special additives Page 47

APOLLO TYRES LTD

Ra@ r CC"r;
Du!!er as such is a soft semi @ solid material which does not have any properties re5uired for tyre components li"e elasticity* hardness* resistance etc. &atural ru!!er occupies the top position as the general ru!!er. It gives good strength* tear* wear and fle0 resistance* good process a!ility and low heat !uild up and good a!rasion resistance. Synthetic !utadiene ru!!er >S=D? is the first synthetic ru!!er developed. It offers good strength and tear* good crac"* initiation* resistance* well whether resistance and fine process a!ility. S=D is also recommended for !ead compounds for higher hardness.

V 5!a%i<i%?
Daw ru!!er when heated with vulcani:ing agents !ecome elastic* stronger and harder and this process is called vulcani:ing. /uring vulcani:ing* the long chain ru!!er molecules are cross @ lin"ed to form a networ" there!y ma"ing it elastic. The cross lin"s are generally achieved !y adding sulphur and sulphur donors.

A!!"5"ra)or#
To increase the speed of vulcani:ation* accelerator is used. Accelerators are classified on the !asis of the speed of the vulcani:ing imparted !y it.It is also classified as )rimary accelerator and secondary. A secondary accelerator is the one* which is used as the !ooster to the primary accelerator.

A!)i:a)or#
Activators are used to improve the efficiency of accelerator and it improves the elasticity and the strength of vulcani:ing agent. The general activators are :inc o0ide and stearic acid.

R"i%6or!i%? a?"%)#
A vulcani:ing thus made of raw ru!!er* vulcani:ing agents* accelerators and activators is still soft li"e ru!!er !and. Cor improving the strength* hardness* tear and wear and fle0 properties suita!le for a tyre compounding* reinforcing agent are used. Deinforcing agents are car!on !lac" and silica. Page 4-

APOLLO TYRES LTD

Ma)"ria5 #"& 6or )yr" r" 0 "%6or!"m"%)

'arcass and !ead materials used in a tyre are called tyre re @ enforcement. Te0tiles in the form of continuous filaments are the primary material for the tyre carcass. To form a ply* sufficient num!er of continuous filaments is twisted together. 'ords are then woven into fa!rics in special looms* with cords in longitudinal direction called wrap and thin cotton filaments in the opposite direction called weft. =ead wire is a special alloy steel wire with !ron:e plating used as a !ead wire for tyre.

Pro!"## oi5#
Incorporation of re @ enforcing agents in a ru!!er is often difficult and to facilitate easy incorporation process* oils are used. These are also used to improve compound process a!ility at calendar and e0truder.

A%)i 0 &"?ra&"%)#
%ost of the ru!!ers are highly suscepti!le to degradation when su!(ected to heat* fle0* and weather and to ta"e care of these anti @ degradents are added.

Fi55"r#
Often* through not common* low cost su!stance called fillers are added to reduce compound cost.

Pro!"## ai&#
)rocess aids are those su!stances that are added to ru!!er compounds for reducing viscosity of the stoc" and for improving process safety.

S("!ia5 a&&i)i:"#
Sometimes special additives li"e !ounding agents* hardening agents* and corrosion inhi!itor etc are added for specific vulcani:ation properties.

A Fi5iary ma)"ria5#

Page 44

APOLLO TYRES LTD %a(or au0iliary materials used in the tyre manufacturing process are dip solution* chemicals* solvents* lu!ricants and seperants.

Ma% 6a!) ri%? (ro!"## a!)i:i)i"#

The entire production system has !een !roadly divided into three sections * namely /ivision A* /ivision =* /ivision '. /ivision A @ Ta"es care of assem!ling activities. /ivision = @ Ta"es care of !uilding activities. /ivision ' @ Ta"es care of the curing activities.

DIVISION-A 1. COMPOUND MIHING

A compound is made !y mi0ing the re5uired additives into ru!!er. This mi0ing is accomplished in two or more steps using a =an!ury mi0er. This mi0ing is done in the cham!er of the =an!ury mi0er under high shear and pressure using the rotors of the machine so that the ingredients and uniformly dispersed inside the ru!!er matri0. /ifferent ru!!er compounds >differing in the recipe? are used in the different compounds of the tyre. The ru!!er compound is then used for the preparation of different components in su!se5uent stage of manufacture. 1. Tread 2. Sidewall <. Tread cushion 7. )lies -. 'hafer 4. Clipper 7. Ciller ,. =ead Page 47

APOLLO TYRES LTD 9. S5ueegees 1 . =rea"ers &aturally the compounds prepared in the =ar!ary go to the respective e5uipment and process for further processing.

2. CEMENT PREPARATION
.arious cements* solutions* lu!ricants and paints are prepared in the cement house sing ru!!er compound solvents and other raw materials. These are then used at various stages of tyre manufacturing.

<. FABRIC DIPPING;

A raw fa!ric >Dayon and &ylon? is having very poor adhesion to the ru!!er compound and has poor dimensional sta!ility. /uring the dipping process an adhesive coating >eg. Desorcinol* formaldehyde*.) late0 dip? is applied to the surface of the fa!ric to improve adhesion. The fa!ric is also stretched and hot set to increase the dimensional sta!ility. /ipping is accomplished in the dip unit and the dipped fa!ric is then used for the preparation of the different compounds as mentioned a!ove.

7. EHTRUSION;
9ere compounds of the tyre li"e tread and sidewall are prepared from the ru!!er compound using a /ual e0truder. F0truder is the process !y which the ru!!er compound is given definite continuous shape. A thin sheet of ru!!er compound prepared using a small 2$roll calendar is applied to the !ottom side of the tread. This compound is called tread cushion. The continuous profile is then cooled and cut to re5uired length which is used in the assem!ling of tyre at tyre !uilding.

EHTRUDERS
F0truders are distinguished !y the diameter of their screw and are a single or dual type. a? SINGLE EHTRUDER

Page 4,

APOLLO TYRES LTD Du!!er compounds after !eing !ro"en down and warmed up on %ills* are fed in to the screw of the e0truder from which with the help of dies* produces a green shape of treads* sidewalls* and other strips as per specified dimensions and contours* width* gauge and weights. These strips are cooled in water sprayed conveyors and then cut out into specified lengths with the help of s"ivers >rotary cutting "nife? and !oo"ed in metal trays or wrapped in cotton liners. The word green denote uncured ru!!er >i.e. &on vulcani:ed? !? DUAL EHTRUDER Two separate set of mills on which two different types of compounds are !ro"en down and heated and fed separately to two different screws. The two compounds after e0trusion are e0truded together in a common head and with the help of performer and final dies* emerge into a pre determined shape. The advantage of the dual e0truder is that two ru!!er compounds of completely different composition can !e e0truded.

-. CALANDER
Ca!ric calendaring is the process of coating !oth sides of dipping fa!ric using ru!!er compound. This is accomplished using a 7 roll M6# type calendar. The coated fa!ric is cooled and wound in liner >in continuous length? to avoid stic"ing. This goes to the ne0t stage of ply cutting.

4. PLY CUTTING 7Hori<o%)a5 a%& :"r)i!a5 Bia# ! ))i%?8

Cor cutting a tyre several plies are re5uired. Cor e. g a 14 )D nylon truc" tyre used , plies and 2 !rea"ers. Fach ply is cut from the coated fa!ric rolls prepared !y calendaring. This process of ply cutting is accomplished in a !ias cutter. Fach ply is cut at specified widths and angles. The width depends on the type of tyres and the angle of the cut depends on the type of services re5uired. The cut plies then go to < roll for s5ueegee application. 'omponents li"e chafer and flipper are also made at !ias cutters. These are further slit using a slitter into small widths and would into rolls. 'hafer rolls from slitter go to the tyre !uilding and flipper goes to the !ead flipping.

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APOLLO TYRES LTD

7. SAUEEGEE CALENDARINGJSAUEEGE APLICATION

S5ueegee calendaring is the process of ma"ing thin sheet of ru!!er compound usually !y using a < roll or 7 roll calendars. S5ueegees are used at the inner most layer of the tyre >drum s5ueegee? and also in !etween the different plies >ply s5ueegee?./rum s5ueegee is prepared in the 7 roll 6 calendar. It is in liners this s5ueegee roll is sent to tyre !uilding for assem!ling. The ply s5ueegee preparation and its application on to the cut plies are accomplished simultaneously at the < roll calendar after s5ueegee application the plies are sent to tyre !uilding for assem!ling.

DIVISION 0 B ,. BEAD PREPARATION

It consist of three stages; =ead winding =ead Cillering =ead Clipping

a8B"a& @i%&i%? 9ere several wires are passed through the head of a !ead e0truder and coated with ru!!er compound. The coated tape so formed is wound into !undles of definite turns and strands and of definite diameter. The process is accomplished using a machine called the !ead winding machine. C8B"a& Fi55"ri%? 9ere a triangular shaoed continuous ru!!er profile >called !ead filler? is e0truded using a cold feed e0truder and applied on the !ead !undle using a fillering machine. Page 7

APOLLO TYRES LTD

!8B"a& F5i((i%? The flipper fa!ric prepared at the !ias cutter and slitter is applied around the fillerd !ead !undle. This is accomplished using a !ead flipping machine. 9. TYRE BUILDING It is the process of assem!ling various components into the semi finished product called a Mgreen tyre#. This is accomplished !y a tyre !uilding machine. The components li"e drum s5ueegee* plies >with s5ueegee applied on it? are assem!led using a tyre !uilding drum. The flipped !eads are applied from the ends and loc"ed in using the ply endsS !rea"er and chafer are applied ne0t. Cinally the tread and sidewalls are applied. The assem!ly >green tyre? is ta"en out after collapsing the drum.

The different components that ma"e a green tyre are the following; )lies =rea"ers 'hafer =eads Tread Sidewall

DIVISION 0 C 1 . TYRE CURING

The green tyre inspected and they applied with a lu!ricant inside and an anti$ !lemish paint on the outside sidewall area. The green tyre is also availed to facilitate easy removal of trapped air during the final shaping and moulding operation. The green tyre is shaped and given the final contour using appropriate tyre curing moulds >fitted to tyre curing presses? !y the application of pressure and temperature. The ru!!er compound gets vulcani:ed during curing and !ecomes tough and elastic and provides all the desired properties re5uired in the tyre. The curing times vary Page 71

APOLLO TYRES LTD depending upon the si:e of the tyre varying from 72 minutes for a passenger car tyre to ane hour for truc" tyres.

11. POST CURING INFLATION

&ylon tyres after press curing are "ept under high pressure inflation to help shape retention and to reduce growth in service. This process of cooling tyre under high inflation pressurenis called post cure inflation >)'I?.

12. INSPECTION
The tyres after )'I are su!(ect to vend trimming. The tyres are then inspected 1 H for visual effect. The tyres are also statistically sampled and tested for conformation to =IS specification and warehoused.

MAJOR LOSSES DURING PRODUCTION

=rea" down of machineries 1oss of time for setting up of machines 1oss due to difference of machine speed 1oss due to stoppage of production 1oss due to mista"es and correction of mista"es

TOTAL PRODUCTIVE MAINTANANCE 7TPM8

, pillars of T)% are as follows; 1. Autonomus maintenance 2. F5uipment and process improvement <. )lanned maintenance 7. Fducation and training -. Ouality maintenance 4. Initial control Page 72

APOLLO TYRES LTD 7. T)% in office departments ,. Safety* health and environment )roduction facility is the !ac"!one of any manufacturing !ased organisation. Apollo Tyres is very much improved in production capacity. The per day production of Apollo Tyres 1td is 27 possi!le !ecause of hard wor" of employees. tones. This achievement is only

,.AUALITY ASSURANCE DEPARTMENT

Ouality is the totality of characteristics of an entity that !ears on its a!ility to satisfy* stated and implied needs. Ouality is referred to as Citness for use Citness for purpose 'ustomer satisfaction 'onformance to re5uirements

STRUCTURE OF AUALITY ASSURANCE DEPARTMENT

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APOLLO TYRES LTD

BDO2) %A&ABFD $ Ouality assurance

FNF'2TI.F @ Cinished products

FNF'2TI.FS @ Ouality system G capa!ility studies >'hart no -.-?

FNF'2TI.F $ 1a!

S9ICT$I&$ '9ADBF$ )urchase I )roduction

Ouality Assurance is the well planned and systematic activities implemented within the 5uality system and demonstrated as needed to provide ade5uate confidence that an entity will fulfil re5uirements for 5uality.

AUALITY ASSURANCE
O2A1ITE ASS2DA&'F

1A=

)DO'FSS 'O&TDO1 G A2/IT >'hart no -.4?

o LAB
All raw materials that come to D%S are released for production only after la! approval. Cor that samples of raw materials >Du!!er* 'ar!on* 'hemicals and Ca!ric etc? are given to la!. In la! these raw materials samples are tested. If the test result are within the re5uired specifications a!ove material is released for production. If the result is not o"* material is re(ected. In the same way processed material samples are also given to la! for testing >e. g ; %i0ed Du!!er 'ompound* /ipped Ca!ric* 'alendared Ca!ric etc?. These

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APOLLO TYRES LTD materials are realised for further processing only if the test result is O+. If the test result is not O+* processed material will !e held up for technical disposal.

o PROCESS CONTROL AND AUDIT;

In shifts* all the production areas will !e audited !y Ouality Assurance will chec" whether the processing is done within the re5uired specifications. If any a!normality is noticed* necessary corrections will !e done and the defective processed materials will !e held up. Cinished product >cured tyres? will !e also chec"ed !y Ouality Assurance. If any defect is noticed on finished tyre it will !e held up. Only O+ tyre will !e released to warehouse. Samples of cured tyre are tested indoor on a test wheel. The test wheel simulates the running condition of a tyre* primarily used to detect car ass strength and heat generation. Tyres are also fitted on different vehicles to study the effect of different types of roads* loads and climate conditions. Cor Original F5uipment >OF? there is 1 H inspection !y 5uality assurance. The different methods used for chec"ing are /imension* )ulley wheel and )uncher.

4. SYSTEMS DEPARTMENT
The system department is responsi!le for computeri:ed of different departments of Apollo Tyres 1td. The main function of this department* operates and co @ ordinates all systems in the organisation. The simple structure of department facilitates speedy communication flow with in the department. BDO2) %A&ABFD @ SESTF%S*))' G IF Page 7-

APOLLO TYRES LTD

FNF'2TI.F $ SESTF%S >'hart no -.7?

MONITORING FUNCTION
Security pro!lems in the SA) >Systems Application and )roducts? were solved using 'entral .irus Scanning System and Cirewall at the head office >Burgaon* 9aryana?.9'1 solve all the pro!lems related to the networ" connection.

MAINTENANCE FUNCTION
The systems departments in the plant solved networ" pro!lems as well as computer pro!lems. Degular !ac"ups were ta"en daily* wee"ly and monthly for providing relia!ility in the SA) system. All the computers were connected using !oth point to point and star topology to form an Internet inside the plant. )roper authentication was given to each department mem!ers using I/ and a password. Apollo ma"es 2- different types of tyres today. IT helps them to "eep trac" of every product* its demand forecast and production cycle. The way the automo!ile sector is growing* they will need IT to map their production and ensure they don#t lose new or present customers.

7. PRODUCTION PLANNING AND CONTROL DEPARTMENT

The resources in terms of machines* men* material etc are used in the tyre plant run into several crores and it is necessary to ma"e !est possi!le use of these resources to achieve ma0imum economy in production costs. The main o!(ective of production planning control is therefore to ensure optimum utili:ation of those resources as well as the capital loo"ed up in wor" in progress inventory.

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APOLLO TYRES LTD

STRUCTURE OF PRODUCTION PLANNING AND CONTROL DEPARTMENT

BDO2) %A&ABFD @ ))'* IF G SESTF%S

ASSO'IATF %A&ABFD $ ))'

%A&ABFD ))'

FNF'2TI.F

FNF'2TI.F >'hart no -.,?

The ma(or activities of )roduction )lanning and 'ontrol could !e enumerated as follows; 1. Scheduling of machines 2. To ensure that machines are !ought out* re5uired components are ordered at the right time to fit in with the plan of wor" schedule for the shop floor. <. To ensure that the proper man is doing the proper wor" in specified time consuming specified material at specified 5uality.

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APOLLO TYRES LTD The ma(or responsi!ilities and functions of )roduction )lanning and 'ontrol could !e enumerated as follows; $ $ $ Fsta!lishing departments. )lanning and control of production schedule. Fnsure ade5uate production and inventory. production program in consultation with mar"eting

The )roduction )rogram of )roduction )lanning and 'ontrol is prepared !ased on the following; %achine capacity 1a!our re5uired Daw material re5uirements F5uipment and other tools re5uired for manufacturing >moulds* drums etc?.

Ra@ ma)"ria5#
1iaison with material control and technical departments for re5uirement of raw materials as per the consumption pattern. Authorise D%S for issue of raw materials to production floor.

S!'"& 5i%?
%achine scheduling includes day to day scheduling machine loading in the most optimum level. Deview of progress and initiation of action to remove !ottle nec" planning and control of in process inventory at optimum level etc.

Ma!'i%"#
Deview of machine capacity and its limitation with respect to production programme to initiate corrective actions. Access of material handling e5uipment and storage systems and arrange for procurement whenever necessary. Scheduling in !rief is determination of 1. Ahen a (o! will !e done. 2. Ahere to do this (o! >incase where is more than one machine? <. 9ow much to do in one lot )roduction planning and control is an important department in any manufacturing company. )roduction planning will mainly consist of the evaluation Page 7,

APOLLO TYRES LTD and determination of production inputs such as la!our >man power?* machinery and e5uipment* materials and utilities to achieve the desired goal.

,.INDUSTRIAL ENGINEERING DEPARTMENT

Industrial engineering department helps to maintain the machines which has !een using for the production process. Thus this department helps to avoid the distur!ance during the production process.

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APOLLO TYRES LTD

/I.ISIO& 9FA/

%A&ABFD

FNF'2TI.FS >'hart no -.9?

OCE"!)i:"#;
The main o!(ective of this department is to plan* design* implement and image integrated production and service delivery system that assure productivity* 5uality* relia!ility* maintaina!ility and cost control to "eep Apollo glo!ally competitive.

F %!)io%#;
1. 'onduct wor"$studies* improvement studies in various e5uipment and fi0ation of norms. 2. 'apacity calculation in various e5uipments from time to time conse5uent to various changes. <. /esign* implementation and follow up of incentive schemes in various :ones. 7. )lanning and assessment of man power re5uirements of various departments periodically. -. Studying plant layout and material handling systems and suggesting improvements. 4. F0plore the possi!ilities of capacity e0pansion and prepare pro(ect report. 7. &egotiation with unions regarding worries* issues li"e incentive schemes* productivity* e0pansion and la!our issue. ,. Analysis of capital e0penditure re5uest from various department and ma"e recommendation to senior management committee. 9. )repare !udgetary planning for capital and cash flow re5uirement. 1 . )repare documents for long term settlements* !onus settlements etc and represent the management in the meeting with the unionIla!our departments. 11. .isit other industries for getting information regarding 1TS methods* practice and other developments. Page ,

APOLLO TYRES LTD 12. 'onduct various training classes for wor"men* supervisors* other officers and new recruits. 1<. Apply various industrious engineering techni5ues such as (o! evaluation* O G % >Organisation and methods? studies* "ai:en* line !alancing etc. 17. Suggest various cost reduction programmes and implementation. 1-. Associate with professional !odies li"e productivity council* &ITTIF etc and institution of engineers etc. 14. 'onduct daily audit on man power* productivity* lost time* scrap detail* a!senteeism* overtime etc. 17. Curnish various other management information reports of the top management. 1,. Involve !est practices and processors through glo!al !ench mar"eting in the conte0t of glo!al competitions and intense customer focus. 19. Optimise inventory levels at various stages such as engineering store* wor"ing progress and finished goods. 2 . 'ontinues improvement of methods and e5uipments designed compati!le to the !est economic standards. 21. )reparation and presentation of daily review report on critical parameters. 22. )reparation of machine utili:ation report. 2<. 'omputation of "ilogramIman hour. 27. 'omputation of indirect incentive earning rate. 2-. 'omputation of various data and su!mission of application for various awards. 24. 'omputation of plant performance report on a daily !asis and display. 27. F0tent the support to the line function term regarding manpower details* norms* new products etc. 2,. Incentive earning computation and releasing of incentive earning list. 29. Incentive allowance computation and advice to finance and time office for payment.

9.FINANCE DEPARTMENT
The corporate office situated at Burgaon does most of the accounting and ta0ation (o!s of AT1. At )eram!ra plant there is separate accounting and finance

Page ,1

APOLLO TYRES LTD department. This department deals with salary* wages and costing. F0cise duty of the raw materials also comes under this department. STRUCTURE OF FINANCE DEPARTMENT /I.ISIO&A1 9FA/

%A&ABFD

%A&ABFD

ASSO . %A&ABFD FNF'2TI.FS

ASSO . %A&ABFD FNF'2TI.FS

>'hart no -.1 ? Sales is performed and maintained !y the corporate office of Apollo Tyres 1td. The fund for ac5uiring raw materials will !e provided from the corporate office to Accounts and Cinance /epartment. Ahen* with regard to e0port of tyres they will !e directly unloaded into the 'ochin Shipyard premises rather than unloading to the corporate office godown and then to the port. An annual cost audit is also conducted along with the company audit every accounting year i. e* April 1st to <1st %arch. Bross sales during the financial year ended %arch <1* 2 , amounted to an all time high of 72*749.,< million as against Ds.<7* 77<.7< million during the previous year* recording growth. The strong performance of Apollo is com!ination of high growth in sale along with enhanced operation management* !etter wor"ing capital management* aggressive mar"eting and overall cost reduction measures adopted !y the company.

SECTIONS UNDER FINANCE DEPARTMENT

1. Accounts Page ,2

APOLLO TYRES LTD 2. 'osting <. )ayroll 7. F0cise -. Daw material stores 4. Cinished goods stores 7. Fngineering stores ,. )urchasing of engineering goods

OBJECTIVES
To arrange ade5uate funds for the !usiness To ensure proper utilisation of funds To increase profita!ility of !usiness To ma0imise the value of the firm To do the analysis and appraisal of financial performance To anticipate the financial needs To maintain good relations with suppliers and monitor their performance )hysical location and stoc"ing of materials %inimi:ation of damage

FUNCTIONS
Cinancial forecasting and planning To advise top management on all financial matters and to suggest various alternative solution for any financial difficulty 'o$ ordination and control 9elp in ta0 administration and ta0 planning )reparation of audit report Storage of raw materials* finished goods and engineering goods 9andle scrap disposal

SHARE HOLDING PARTNERS

Coreign holdings 2-.47H Page ,<

APOLLO TYRES LTD Bovernment or Cinancial institutions 'orporate !odies >non covered a!ove? /irectors and their relatives Other including Indian pu!lic 29H 7. 7H <2.7<H ,.,7H

Cinance is the !ac"!one of every organisation. So finance manager plays an important role* at the same time he has also some responsi!ilities. The role of finance manager is to prepare the accounts and auditing of all the financial transactions of the company and have the advisory function in the financial and esta!lishment matters. The fundamental decision ma"ing areas of financial manager are capitalisation decision* investment decision decision* financing decision.

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APOLLO TYRES LTD

CHAPTER - S1OT ANALYSIS

S)r"%?)'#;
'ontinued mar"et leadership in the dominant industry segment of truc" and !us tyres.

Page ,-

APOLLO TYRES LTD Blo!al presence with the accusation of Apollo Tyres South Africa >pty? 1td. >Cormerly "nown as /unlop Tyres International>)ty?1td. F0tensive distri!ution networ" in India and South Africa. Strong !rand recall in a price sensitive Indian mar"et. Desponsive to changes in mar"et conditions and product profiles. Blo!al 5uality standards* international process and system certifications. 9igh usage of information technology systems to hasten the flow of information and leverage opportunities across 17 locations in India. /ynamic and progressive leadership* willing to implement change. Fconomies of transportation cost* on account of closeness to natural ru!!er growing !elt. Blo!al sourcing of raw material.

1"aD%"##;
&o presence in two and three wheeler segment. 'apital intensive !usiness. %aintain a healthy relationship with trade unions %ore training facilities must !e given to employees The company should invest more on advertisement.

O((or) %i)i"#;
1eadership position in the commercial vehicle segment will ena!le the 'ompany to leverage new and related !usiness opportunities. &ew product segments li"e Truc"I=us Dadial >T=D?* Off The Doad tyres >OTD* retreading and allied automotive services. Browth in Overseas mar"ets li"e Furope.

T'r"a)#;
Imports from neigh!ouring countries at competitive prices. Daw material price volatility.

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APOLLO TYRES LTD

CHAPTER . PORTERBS FIVE FORCES ANALYSIS

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APOLLO TYRES LTD

A MODEL FOR INDUSTRY ANALYSIS; Por)"rK# 6i:" 6or!"# a%a5y#i# is a framewor" for the industry analysis and !usiness strategy development developed !y %ichael F. )orter of 9arvard =usiness School in 1979. It uses concepts developed in Industrial Organi:ation >IO? economics to derive five forces which determine the competitive intensity and therefore attractiveness of a mar"et. Attractiveness in this conte0t refers to the overall industry profita!ility. An TunattractiveT industry is one where the com!ination of forces acts to drive down overall profita!ility. A very unattractive industry would !e one approaching Tpure competitionT. The model of the Cive 'ompetitive Corces was developed !y %ichael F. )orter in his !oo" U'ompetitive Strategy; Techni5ues for Analy:ing Industries and 'ompetitorsK in 19, . Since that time it has !ecome an important tool for analy:ing an organi:ations industry structure in strategic processes. )orter#s model is !ased on the insight that a corporate strategy should meet the opportunities and threats in the organi:ations e0ternal environment. Fspecially* competitive strategy should !ase on and understanding of industry structures and the way they change. )orter has identified five competitive forces that shape every industry and every mar"et. These forces determine the intensity of competition and hence the profita!ility and attractiveness of an industry. The o!(ective of corporate strategy should !e to modify these competitive forces in a way that improves the position of the organi:ation. )orters model supports analysis of the driving forces in an industry. =ased on the information derived from the Cive Corces Analysis* management can decide how to influence or to e0ploit particular characteristics of their industry.

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APOLLO TYRES LTD

T'" Fi:" Com(")i)i:" For!"#

The Cive 'ompetitive Corces are typically descri!ed as follows; Bar?ai%i%? Po@"r o6 S ((5i"r# The term QsuppliersQ comprises all sources for inputs that are needed in order to provide goods or services. Supplier !argaining power is li"ely to !e high when; L The mar"et is dominated !y a few large suppliers li"e %DC* 8+ Tyres rather than

a fragmented source of supply. L L L L There are no su!stitutes for the particular input. The supplier#s customers are fragmented* so their !argaining power is low. The switching costs from one supplier to another are high. There is the possi!ility of the supplier integrating forwards in order to o!tain

higher prices and margins. L L The !uying industry has a higher profita!ility than the supplying industry. The !uying industry >automo!ile? hinders the supplying industry in their

development >e.g. reluctance to accept new releases of Tyres?* L The !uying industry has low !arriers to entry. In such situations* the !uying industry often faces a high pressure on margins from their suppliers. The relationship to powerful suppliers can potentially reduce strategic options for the organi:ation. Bar?ai%i%? Po@"r o6 C #)om"r# Similarly* the !argaining power of customers determines how much customers can impose pressure on margins and volumes. Page ,9

APOLLO TYRES LTD 'ustomers !argaining power is li"ely to !e high when V V V V They !uy large volumesS there is a concentration of !uyers. The supplying industry comprises a large num!er of small operators. The supplying industry operates with high fi0ed costs. The product is undifferentiated and can !e replaces !y su!stitutes.

V Switching to an alternative product is relatively simple and is not related to high costs. V V 'ustomers have low margins and are price$sensitive. The customer "nows a!out the production costs of the product. T'r"a) o6 N"@ E%)ra%)# The competition in an industry will !e the higherS the easier it is for other companies to enter this industry. In such a situation* new entrants could change ma(or determinants of the mar"et environment >e.g. mar"et shares* prices* customer loyalty? at any time. There is always a latent pressure for reaction and ad(ustment for e0isting players in this industry. The threat of new entries will depend on the e0tent to which there are !arriers to entry. These are typically V V Fconomies of scale >minimum si:e re5uirements for profita!le operations?. 9igh initial investments and fi0ed costs.

V 'ost advantages of e0isting players due to e0perience curve effects of operation with fully depreciated assets. V V V V V =rand loyalty of customers. )rotected intellectual property li"e patents* licenses etc. Scarcity of important resources* e.g. 5ualified e0pert staff. Access to raw materials is controlled !y e0isting players. /istri!ution channels are controlled !y e0isting players. Page 9

APOLLO TYRES LTD V F0isting players have close customer relations* e.g. from long$term service contracts. V V 9igh switching costs for customers. 1egislation and government action. T'r"a) o6 S C#)i) )"#; A threat from su!stitutes e0ists if there are alternative products with lower prices of !etter performance parameters for the same purpose. They could potentially attract a significant proportion of mar"et volume and hence reduce the potential sales volume for e0isting players. This category also relates to complementary products. Similarly to the threat of new entrants* the treat of su!stitutes is determined !y factors li"e V V V V V =rand loyalty of customers. 'lose customer relationships. Switching costs for customers. The relative price for performance of su!stitutes. 'urrent trends. Com(")i)i:" Ri:a5ry C")@""% EFi#)i%? P5ay"r# This force descri!es the intensity of competition !etween e0isting players >companies? in an industry. 9igh competitive pressure results in pressure on prices* margins* and hence* on profita!ility for every single company in the industry. 'ompetition !etween e0isting players is li"ely to !e high when V V There are many players of a!out the same si:e. )layers have similar strategies.

V There is not much differentiation !etween players and their products* hence* there is much price competition. V 1ow mar"et growth rates >growth of a particular company is possi!le only at the e0pense of a competitor?.

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APOLLO TYRES LTD Dia?ram o6 Por)"rK# , For!"# SUPPLIER PO1ER Supplier concentration Importance of volume to supplier /ifferentiation of inputs Impact of inputs on cost or differentiation Switching costs of firms in the industry )resence of su!stitute inputs Threat of forward integration 'ost relative to total purchases in industry BARRIERS TO ENTRY A!solute cost advantages )roprietary learning curve Access to inputs Bovernment policy Fconomies of scale 'apital re5uirements =rand identity Switching costs Access to distri!ution F0pected retaliation )roprietary products BUYER PO1ER =argaining leverage =uyer volume =uyer information =rand identity )rice sensitivity Threat of !ac"ward integration )roduct differentiation =uyer concentration vs. industry Su!stitutes availa!le =uyersQ incentives

THREAT OF SUBSTITUTES $Switching costs $=uyer inclination to su!stitute $)rice$performance trade$off of su!stitutes

DEGREE OF RIVALRY $F0it !arriers $Industry concentration $Ci0ed costsI.alue added $Industry growth $Intermittent overcapacity $)roduct differences $Switching costs $=rand identity $/iversity of rivals $'orporate sta"es

>'hart no 7.1?

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APOLLO TYRES LTD

CHAPTER - / FINDINGS AND SUGGESTIONS

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APOLLO TYRES LTD

FINDINGS
AT1 is the first tyre company to receive ISO 9 the few tyre manufactures to o!tain OS 9 1 certification and one certification.

Aor"ers health and safety are given prime importance A good co$ordination e0ists !etween different departments. Trade unions play vital role as !argaining agents. The management is sometimes forced to accept demands made !y the unions. The products of the company are "nown for its high 5uality standards. The wor"ers are not completely satisfied with the wages they are paid. Fmployees are provided with facilities such as su!sidi:ed canteen* transportation etc. Safety posters and slogans are e0hi!ited inside the plant and various safety awareness programs are also conducted. The factory premises are "ept clean which comes under a dedicated system "nown as Fnvironment %anagement System >F%S? Cactory is located at an ideal location that allows easy access to land* air and sea transportation. All departments at the plant are !eing connected through SA) which gives real time connectivity with each other. All the plants of Apollo tyre group are !eing connected with the head 5uarters through AA& and SA) which critical decision ma"ing easy.

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SUGGESTIONS %aintain the relationship !etween employees and employers There should !e training program for !etter understanding of SA) A !it more promotional activities could enhance !uilding !rand image %aintain a healthy relationship with trade unions %ore training facilities must !e given to employees The company should enter into twoIthree wheeler mar"ets. The company should invest more on advertisement. Fach should have an in house mar"eting department that can ta"e care of the local fluctuations in mar"et.

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CONCLUSION
Apollo tyres 1td is the 7 th fastest growing tyre company in the world. A fair wage system prevails in AT1. The company provides !etter wor"ing condition for employees. )roper training to wor"ers and efficiency of the wor"ers must !e increase to increase production. The industrial relation with the local union is fairly good. The company is facing a cut throat competition in Indian mar"et and international mar"et. /espite of all these challengers Apollo has done well in the past and with a !ooming economy and a focused progressive leadership at the top. The employees en(oy wor"ing as a team and with customers to create superior and distinct production and services. Apollo is focused on fast and fle0i!le* never ending improvement in order to create an enterprise that is dynamic* ever e0panding and profita!le and in constant pursuit of customer satisfaction is Apollo policy to design* manufacture and service our products to provide the level of 5uality and value that meets ever customer needs. Apollo stands first in the production of truc" tyres. In spite of recession the company is still ma"ing sufficient profit. There are good wor"ing conditions and industrial harmony among the employees. )roper and ade5uate training is given to the employees* which leads to higher productivity*. The company is facing cutthroat competition from Indian mar"et as well as foreign mar"et. In spite of fierce competition and local pro!lems the )eram!ra plant thrives and move forward to its target of <1 %TIday and there!y achieve their 9 crore goal !y the end of 2 1 . Apollo tyres !oast a vi!rant and dynamic* profession and non hierarchical culture. Transparency and communication are cornerstones of corporate practice* across levels* to ensure that each individual employee is aligned with the goals and aspiration of the company. At Apollo Tyres the three corporate pillars of )eople* Ouality and Technology underpin all activities and processes. These are the company#s stated areas of corporate e0cellence* in its (ourney towards !ecoming a !est in class glo!al manufacturer.

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APOLLO TYRES LTD Apollo Tyres* they are always loo"ing out for new opportunities. If opportunities do not come their way* they go ahead and create opportunities. Over the years they have created opportunities for growth* opportunities for success and also opportunities for a !right future.

BIBLIOGRAPHY

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BIBLIOGRAPHY

BooD# r"6"r"%!"
1. /r. Aswathappa +.* 9.D.% G ).%* 7e* Tata %cBraw9ill* /elhi* 2 International )u!lishers* &ew /elhi* 2 4. -. 2. Desearch %ethodology$ %ethods G Techni5ues* +othari.'.D* &ew Age

1"C Si)"#
www.apollo tyres .com www.google.com www.wi""ipedia.com

Ma% a5#
Apollo annual reports Apollo (ournals 8o! sheet of various departments

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APPENDIH

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PROFIT AND LOSS ACCOUNT OF APOLLO TYRES Sl. &o )articulars 1. Bross salesIIncome from operations 2.Other Income Total <.Total F0penditure a? /ecreaseI >Increase? in wor" in progress G Cinished Boods !? 'onsumption of Daw %aterials c? Staff cost d? F0cise /uty e? Other F0penses Total 7. Operating )rofit -. Interest 4. /epreciation 7. )rofit !efore Ta0 ,. )rovision for Ta0 $'urrent $/eferred $Cringe =enefit Ta0 9.&et )rofit 24-.,4 27*974.47 2* 7-.74 7*791.91 7*14,.77 72*27,.47 <*<4 .144,.7< 9, . 7 1*711.47<9.< 17,.47 72.1* ,1.1, >--2.77? 2<*,79.4 2*27 .--*-< .-4 4*7<1.11 <7*,29. , 7*7<2.9, -2 .71 ,7,.1 <*<<7.77 97-. 1 121.7< 7-. 2*19<. < 112.77 7-*4 ,.79 92.2< 72*-42. 4 Eear ended <1. <.2 7-*794.<2 9 Eear ended <1. <.2 , 72*749.,<

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BALANCE SHEET )ADTI'21ADS %ar 9 %ar , %ar 7 %ar 4 %ar -

Apollo Tyres 1td SOURCES OF FUNDS ; Share 'apital - .71 Deserves Total 1*< -.< Total Shareholders Cunds 1*<--.71 Secured 1oans 742.<9 2nsecured 1oans 2<<.1< Total /e!t 49-.-2 Total 1ia!ilities 2* -1.2< APPLICATION OF FUNDS ; Bross =loc" 1*,<,. 1ess ; Accumulated /epreciation 497.44 1ess;Impairment of Assets $ &et =loc" 1*17<.<7 1ease Ad(ustment $ 'apital Aor" in )rogress 2,1.71 Investments 297.7C rr"%) A##")#I Loa%# 2 A&:a%!"# Inventories 717. Sundry /e!tors ,7.2, 'ash and =an" <7 .4 1oans and Advances 19-.77 Total 'urrent Assets 1* 7 .7 L"## ; C rr"%) LiaCi5i)i"# a%& Pro:i#io%# 'urrent 1ia!ilities 74 .1< )rovisions 9-.4< Total 'urrent 1ia!ilities ---.74 &et 'urrent Assets 7,7.97 %iscellaneous F0penses not written .1off /eferred Ta0 Assets 1 .94 /eferred Ta0 1ia!ility 147. 2 &et /eferred Ta0 $1-4. 4 Total Assets 2* -1.2< 'ontingent 1ia!ilities 2,2.,7,.,1*1, . 1*22,.,22<.17 2<7.-1 74 .41*4,9.1*-49.7, -9,.7, $ 971. $ 97.71 < 2.71 -1<.29 1--.1< 24-.,191.-< 1*12-., -4-.,< 9<. , 4-,.91 744.,9 .24 11.29 1-2.79 $171.2 1*497. 7 22<.-4 74.71 92 .71 947.12 77<.74 177.97 41,.7 1*-,-.,2 1*792.-1 -71.44 $ 9- .,$ , .74 2-,.11 7-1.92 <. 4 172. 771.<7 1*24,.<, -72.2 2,9.12 ,<1.<2 7<7. 4 .12 1 .<, 1<9.77 $129. 4 1*-97.-7 11-.27 <,.<7 -9-.4, 4<7. 2 <,1. <49. 7- . 1*<,7. 2 1*<1 .41 749.97 $ ,7 .47 $ 77.9< .-< 719.71 17-.17 2<1.<4 <7 .1, 1*194. 9 <,,.42 2<7.4< 424.2-49.,7 .24 ,.79 11<.7 $1 -.21 1*<,7. 2 49.7< <,.<7 -<,.7 -74.77 <7,.719-. 4 -7<.,1 1*12 .-1*17,.7< <9,.< $ 7- .1< $ ,7.<< -7.7, << .12 1-4.-2 11 .7< < -.72 9 2.79 <, .17 1,,. 7 -4,.21 <<7.-, .<, 2.24 1 -.41 $1 <.<1*12 .-77.29

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