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A PROJECT REPORT ON INTERNSHIP STUDY CONDUCTED AT

APOLLO TYRES LIMITED

Contents Sl.no 1 2 particulars introduction Page no

ACKNOWLEDGEMENT

In successfully completing my project report, I am indeed indebted to a large number of people who have encouraged and helped me in a variety of ways. Its indeed a privilege to express my gratitude to the people involved. First and foremost I am obliged to the Almighty who has showered upon me with his blessings and giving me good health and knowledge to complete this internship successfully. I take this opportunity to express my special acknowledge and gratitude to Apollo Tyres Ltd for giving me the permission to carry on my project in their reputed organization. I wish to express my indebtedness and gratitude to Mr. Samuel Wilson, HR Executive of Apollo Tyres Ltd. With great pleasure I express my deep sense of gratitude and respect to Dr. Grace Paul, HOD of Department of Commerce, Stella Maris College, Madras for her excellent guidance and suggestions in the completion of this internship. I wish to express my heart full gratitude towards my parents for their blessings and moral support without which I would not have been what I am today. Last but not the least I would like to thank my friends who were a source of support and encouragement for successful completion of the internship.

INTRODUCTION

Apollo Tyres Ltd is a high-performance company and the leading Indian tyre manufacturer. Head quartered in Gurgaon, a corporate-hub in the National Capital Region of India, Apollo is a young, ambitious and dynamic organization, which takes pride in its unique identity. Registered as a company in 1976, Apollo is built around the core principles of creating stakeholder value through reliability its products. Apollos present strength and market dynamism steps from its early years of strife in establishing itself as a tyre manufacturer within the closed Indian economy. Over two decades, Apollo worked on a portfolio of products, tuned to customer needs and an array of innovative marketing initiatives to establish itself as a leader in its home market. Some of these include segmenting customers by their load and mileage requirements, running tyre loyalty programmes and establishing customer contact programmes.

For the first time, in 2006 Apollo ventured outside India in its quest to test itself outside its home comforts. Apollo acquired Dunlop Tyres International Pty Ltd in South Africa and Zimbabwe,

The company currently produces the entire range of automotive tyres for ultra and high speed passenger cars, truck and bus, farm, Off-The-Road, industrial and specialty applications like mining, retreaded tyres and retreading material. These are produced across Apollos eight manufacturing locations in India, Netherlands and Southern Africa.

INDIAN TYRE INDUSTRY A PROFILE

INDUSTRY OVERVIEW:

The Indian Tyre Industry has total turnover of Rs. 25,000 Crores with Tyre production is 13.50 lakh. There are 50 tyre manufacturers across India. However, the industry is dominated by 4 Major Player namely, Apollo Tyres Limited, CEAT Limited, MRF Limited, JK Tyres and Industries Limited with total market share of 75%.Of total production, only 13.06% in value is exported by India. The major export element is Truck and Bus category followed by passenger car.

This industry is highly Capital Intensive. The success in the industry is depended on having robust distribution network and product branding. The performance of commercial vehicle tyres is directly linked to the countrys economic development and the performance of automobiles industry.

With rising Industrial and Agricultural output, Favorable demographic distribution with rising working population and middle class Urbanization, and Fast growing economy will infuse production of passenger carrier tyre demand in the country. It is anticipated that the commercial vehicle tyre market will climb to Rs 22.8 Billion by FY 2014.

COMPANY PROFILE
HISTORY OF APOLLO TYRES

Apollo Tyres Ltd. (ATL) was incorporated in 28th September, 1972 as a Public Limited Company and obtained certificate of Commencement of Business on October 24, 1972. The Company was promoted by Bharat Steel Tubes Ltd., Raunaq International Pvt. Ltd., Raunaq & Co. Pvt. Ltd., Raunaq Singh, Mathew T. Marattukalam and Jacob Thomas. The company was taken over by Dr. Raunaq Singh and his associates in 1974.The implementation of the tyre project took place in 1976 at Perambra in Kerala. The research and development of Apollo tyres took place at Perambra and later it had grown to a substantial height and stature at its present location at Limda, Baroda. All the activities in the R&D center are extensively supported by a series of highly sophisticated equipment that help the research scientists develop products as per customers specific requirements.

Their second plant was installed at Limda village at Baroda in Gujarat, which started production in 1991 having capacity of 6.5 lakh tyre/annum. This is most modern plant.

The third plant at kalamassery was taken over by Apollo from Premier tyres. While taking over this plant was a sick unit. After the takeover Apollo spent a good amount in modernizing the plant and now it is profit earning unit. The fourth plant was commissioned in 1996 at Pune for manufacturing tubes. The entire requirement of tubes for all plants of Apollo is done from here.

MILESTONES OF APOLLO TYRES:

1972. The companys license was obtained by Mr.Mathew T Marattukulam, Jacob Thomas and his associates.

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

1975. Perambra plant foundation stone was laid down.

1976. Apollo Tyres Limited was registered.

1977. Plant commissioned in kerala with 49 TPD capacities.

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

1991. The second plant commissioned in Baroda, Gujarat.

1995. Aquired Premier tyres in kerala. 2000. Exclusive radial capacity established in Baroda. 2003. Radial capacity expanded to 6600 tyres per day. 2004. Launch of Apollo Accelere H speed rated car radials. 2005. Peramra plant completes thirty years.

2006. Dunlop South Africa and Zimbabwe was acquired. Expansion of passenger car radial capacity to 100000 tyres per day. Launch of Indias first range of ultra-high performance V and W-speed rated tyres. Opening of Apollo Tyres health care clinic in Ukadam,Tamil Nadu. Launch of Dura tead, trading material and solutions. 2007. Launch of Apollo truck and bus radial tyres. 2007. Launch of Apollo Tennis Initiative and mission 2018. 2008. Integrating the global product portfolio by rebranding the Dunlop brand and rolling out new Dunlop Zones across South Africa. 2009. Aquired VREDESTEIN BANDEN B V in the Netherlands.

CORE VALUES OF THE COMPANY

C - CARE FOR CUSTOMER R R++ESPECT FOR ASSOCIATES E- EXCELLENCE OF TEAM WORK A- ALWAYS LEARNING T-TRUST MUTUALLY E-ETHICAL PRACTICES

VISION A significant player in the global tyre industry and a brand of choice, providing customer delight and continuously enhancing stakeholder value

COMPANY MISSION

A journey called Passion in Motion to be a US$ 2 billion company by the year 2010.

COMPANY AT A GLANCE

Name of the company Business Registered Office Head Office Manufacturing Units Conversion Unit Technical collaboration

: Apollo Tyres Limited. : Manufacturing and marketing Automobile tyres : Cochin, Kerala : New Delhi : Limda-Gujarat, Perambra & Kalamassery- kerala : TCIL- Calcutta : Continental General Tyres, USA

BOARD OF DIRECTORS

Chairman MD Principal secretary ( Industries) , Government of kerala Principal secretary(finance), Government of kerala

: Onkar. S .Kanwar : Neeraj R S Kanwar : T Balakrishnan : L C Goyal

Former chief executive, Dunlop Tyres International(Pty) Ltd. : Michael J Hankinson Chairman , J M Financial Group MD, Apollo Tyres International Ltd. Former principal secretary to the prime minister of India Chief, Corporate Affairs,ATL Former Chairman , Industrial Development , Bank of India : Nimesh M Kampani : Raaja Kanwar : Dr S Narayan : U S Oberoi : M R B Punja

Share Holding Pattern

Promoters Fls / Banks / Mutual funds

: 39.35 % : 15.46 %

FIIs / NRIs / Foreign Bodies Corporate : 26.05 %

Public Govt. of Kerala & others

: 17.16 % : 1.98 %

MARKET SHARE Strong appetite for expansion saw Apollo becoming the number one tyre manufacturer in the truck and bus tyre(Heavy Commercial Vehicle) segment in india. With an average monthly production of 2,72,911 tyres, it ended FY 09 with a 26 per cent share in the HCV segment. In the passenger car segment, Apollo had an average monthly production of 2,63,779 tyres during FY 09, and ended the year with a 19 per cent share.

PRODUCT PROFILE Products Apollo Loadstar Super Hercules Loadstar Super Truck Loadstar Super Gold XT 7 XT 7 Haulug Champion Champion DXL Champion Gold Amar Amar Deluxe Amar Gold

Brands

Amar AT-Rib

XT7 Gold XT-9

XT-9 Gold

Kaizen 50 L 36 L Commando

27 L 77 R

99 R Plus

XDT XT-9 Gold Duramile Milestar

Loadstar Super Light Truck Amar Deluxe Amar Gold

XT-9

Champion

Car Radials

Tube Type (Amazer XL Quantum)

Tubeless Radials

4x4 Radials Passenger Car

Hawkz

Amazer XL

Storm

Alloy Wheels Haste Torque Inspire Slay

Nirvana Frost

Multispoke Sphere

Quest

Cinco

Tubeless Radials Acelere


Hawkz

Amazer XL

Conventional Tyres (Bias Tyres) Car Armour

Jeep Gripper

Panther

Maha Trooper

Pure Cultivation Segment

Sarpanch

Krishak Super

Pure Haulage Segment

Powerhaul

Farm

Mixed Application Bias Segment

Krishak Premium

Mixed Application Radial Segment

Farmking Gripper

Jeep

Maha Trooper

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

KEY DRIVERS FOR THE COMPANY Execution Capabilities: The Company is in tyre manufacture business since 39 years and has developed expertise in its line of operation. The Company is a leading player in Indian market commanding 20% to total market share. Diversified Customer Base: Segment wise major component of Revenue is from India comprising of 60% followed by Europe 27% and South Africa 13% based on Dec 2010(unaudited Result). Replacement category comprises 85% of revenue segmentation by customer and Original Equipment Manufacturers contributes to 15% of total revenue.

Multiple Product: A wide range of products required by Indian Automobiles Industry is catered namely, Truck and Bus Tyre, Passenger Car Tyre, Light Commercial Vehicle tyres. The Company earns its major revenue from sale of Commercial Vehicle tyres. To take the advantage of increasing disposal income in India supported by availability of a variety of vehicle models meeting diverse needs and preferences and easy financing scheme for automobiles, the Company has launched passenger cars tyres for booming small car tyre segment. The increase in disposable income has led to increase in demand for passenger cars thereby the demand for tyres has also increased. The additional demand for passenger cars will create replacement demand in next 24- 48 months. Also, the growing economy has raised demand for freight movement across the nation. This has led to increase in demand for commercial vehicles and tyre demand from Original Equipment Manufacturers, supported by replacement demand in next 12 -18 months First Mover Advantage: The Company has a first mover advantage in its Chennai Plant. Chennai plant currently produces 7000 passenger vehicle tyres and 1300 commercial vehicle tyres a day. And by March 2012, its estimated production is expected to reach 16,000 passenger vehicle and 6,000 commercial vehicle tyres a day Established Distribution Channel: The company is enjoying robust distribution network in India. Post acquisition of Vredestein Banden BV in Europe in May 2009, the company is benefitted with healthy distribution channel in Europe. This acquisition

adds feature to companys plan to become market leader in Europe region. For this, the Company has launched Winter Tyres for European Region in range of passenger cars of 4X4 tyres. The European market provides profitability margin to the tune of 16% compare to Indian market of 8-10%. Beneficial Government Policies: To secure the interest of domestic player, Government of India has imposed anti dumping duty on imports from China and Thailand for the period of 5 years from February 2010 onwards.

CHALLENGES FOR THE COMPANY No Presence in Two and Three Wheeler Category: The Company does not have much presence in two and three wheeler tyre segment in India. With Increase in disposal income, the demand of two and three wheeler is expected to increase. Increase in cost of raw Material Tyre Industry is highly raw-material intensive. Raw materials cost accounts for approx. 63% of tyre industry turnover and 72% of production cost. Raw Material primarily comprises of natural rubber, nylon tyre cord and carbon black. With rise in price of natural rubber touching mark of Rs. 185/kg in Q3FY11 there is huge pressure on profitability margin. Threat from Multinational Players:

Multinational players like Bridgestone and Goodyear Tyres has robust research and development facilities and spends huge on marketing to capture market share. Foreign Currency Volatility: The export comprises 40% of total revenue. As a result the company is exposed to foreign currency fluctuations in respect of proceeds received in various foreign currency. Major Customers are located in Europe and South Africe. The fluctuation in the exchange rate between the rupee and other currencies, including the USD, Pound Sterling, Euro etc. may adversely impact the financials.

Golden achievements: Apollo tyres ltd perambra unit was ranked the first among large scale industries for productivity and energy conservation in the year 20022003 by kerala state productivity council. Apollo tyres ltd received the pollution control award by the central government during the year 2003-2004 National safety council award 2005 Energy conservation award 2006 Apollo receives award for road safety 2006 Quality circle award 2006 National safety council award 2007 Overdrive award for Acelere.

HUMAN RESOURCE AND ADMINISTRATIVE DEPARTMENT

Introduction Human Resource at Apollo Tyres play a pivotal role of weaving the multi location sales offices ,manufacturing plants and corporate office in a growth oriented ,employee friendly working environment . Group manager leads HR department of ATL, HR manager deals with working life of a worker, from the time of his entry in to the organization until he leaves. It basically includes activities such as HR planning, job design, performance appraisal and job evaluation and motivation, welfare, safety and multi facts of Industrial Relations. It is divided into three sections namely industrial relations, security and administration. Heads of each section are in direct contact with the department head. Among the three sections, industrial relations is the biggest section having four subsections looking into personnel and industrial relations, employees arrival and depature, time, health and safety.

Key functions: To design and implement procedures, policies and systems those are transparent and help in achieving company goals. Industrial relations To boost productivity and improve quality through internal customers

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

Focus areas of HR Functions HR philosophy of Apollo Tyres Limited Aims to play an active role in enabling the success and growth of the organization Continuous improvement in the quality of people and their approach towards customer service Providing newer and more effective methods of managing and leading HR oriented growth strategies guide towards top level decisions Strives to maintain a balance between qualitative and quantitative results Creation of an organization wide involvement with the concept of HR Commitment of the top management, which is the backbone for the success of all new HR initiatives

The main functions of the HR department involve Manpower planning Recruitment Selection Performance appraisal Training and development

MANPOWER PLANNING PROCESS The manpower planning process is directly linked to the long term business plans of the organization. The manpower planning exercise is conducted annually to assess the manpower requirements of the organization. At the beginning of each calendar year, Corporate HR interacts with each Department/Function in each Unit/Division to collect their manpower requirements in conjunction with the annual projected business plan. The following factors form the basis for the manpower planning exercise: Product Mix Optimum equipment capacities Existing manpower Envisaged organization structure Comparison of actual versus expected productivity ( measured in terms of Kgs/man-hour) Inter-unit comparisons for common functions

RECRUITMENT POLICIES A well designed and pre-planning recruitment policy, based on corporate goals, study of environment and corporate needs is essential for implementing the organization mission and objectives. The recruitment policy asserts the objectives of the requirement process and provides a framework of implementation of the recruitment programme in the form of procedures. Recruitment is carried out in accordance with the annual manpower plan. Broadly, requirement activities are done at either entry level or lateral level to cater to: Replacement vacancies (occurring due to resignation, retirement or transfer) Additional vacancies ( created due to companys expansion / diversification)

SELECTION

The job profile is communicated to the consultants and bio-data of candidates are invited. The screening of bio-data is completed first by the concerned HR department and then by the concerned Functional Head. An application blank is filled is filled up by the candidate to facilitate the interview process. The preliminary interview is conducted by the HR department. The final interview is conducted by a panel consisting of the concerned Functional Head, and in case of key positions, also by the president and/or VC&MD. Selection procedure is different to different section of employees,

1. Management staff i) Qualification: For technical Engineering trainee for non technical : M.tech, B.tech and Graduate : CA, ICWA, MSW, MBA

Executive trainees after training, they are absorbed as officer. ii) Criteria include a) Consistency in academic performance b) Preliminary test c) Group discussion( non technical) d) Technical interview( technical) e) Personal interview

PERFORMANCE APPRAISAL Objectives The performance appraisal system has the following objectives: Assessing past performance Providing rewards for performance Goal setting for the future Assessing training needs Assessing potential for growth

Eligibility All employees are to be covered under the annual appraisal; however, the trainees and probationers are eligible for appraisal only before their due date of confirmation. Performance appraisal is to be done by the immediate superior to whom the appraise is directly reporting, and the review is to be done by the department Head. In cases where the functional and administrative reporting are separate, both the appraisers are to asses independently and arrive at a joint decision (if location factors are a constraint, then two separate forms are to be given to both the appraisers and information collected is to be summarized by the HR department.

TRAINING AND DEVELOPMENT Objective The training and development procedure of Apollo Tyres Ltd has the following broad objectives: To porn up identified functional skill areas of personnel for more effective contribution to the organization. To provide platform for personal growth and exploration leading to overall organizational health and quality of life. To develop human resource in consonance with broader corporate horizon and long range vision of the organization.

The head of the corporate human resource is responsible for overseeing the implementation of the training methodology. Respective Divisional HR is responsible for implementing of the training procedure for the employee under their purview. Training Types 1) Induction Training The new joinees in the organization are inducted through an induction program with necessary retail and particular exposures to the organization realities . 2) On Going Training For Management Staff The training needs of the employees are assessed on a 3 dimensional framework viz .Functional, Cross Functional and self development .On the job training is given to the regular employees of the company. The department heads identify the training needs every year for individual employees of particular group and it shall be communicated to the HR department.

HR department also has the following functions: WELFARE MEASURES The aim and objective of the welfare fund shall be to render financial assistance to encourage cultural, sport, social and other welfare activities among the members and to foster among them a spirit of mutual friendship, cooperation and understanding. The organization provides good welfare services to its employees. The company runs a subsidized canteen on a contract basis. Rest rooms with

lockers and washing facilities, arts and sports club, library, etc are other facilities provided. Transportation facilities are also provided to all employees. Company buses will take the employees from different destinations for which they have to pay a nominal amount. All the employees drawing a salary below 6000 are covered under ESI and those who are exempted to ESI are covered under group accident policy and MEDICLAIM policy. The welfare department also includes insurance schemes, policies managing the welfare fund activities. SAFETY Safety section facilitates safe working conditions to all employees. The organization follows all the provisions under the Factories Act 1948. All workers are bound to observe safety precautions as directed and notifies from time to time and use safety equipments or clothing as may be required by the management. All accidents should be reported at once by the workmen concerned to his immediate supervisor and in his absence to department head. Workmen should engage themselves only to the operations at the machine to which they have been appointment. Fire extinguishers are placed at reachable points and the employees are trained to use them. TIME OFFICE The functions of the time office are as follows: Maintain attendance record of the workers., staff and all employees Calculation of incentives Calculation of man-day, absenteeism, and maintain leave records Security executives Maintain security of properties, personnel and information

Looks into the arrival and departure of employees, punching, control of shifts, allotment of gate passes and movement pass of worker, visitors pass etc. PERSONNEL Matters connected with recruitment, career promotions, transfers and posting, retirement and reservation guidelines concerning executives, staff and workmen Design and implementation of HR policies Matters connected with annual performance, assessment report of all employees and all development activities. Matters related to the appointment of employees, induction of apprentices, appointment of trainees under company scheme, etc.

Industrial relations: Union management relation:MUTUAL TRUST + UNDERSTANDING = TEAMWORK

A good industrial relation exists in the organization. The management and the employees jointly find the solutions for the problems there exists well relation between employer and employees. There are four main trade unions recognized by the company: i) ATSWN ( Apollo tyres staff and worker union) ii) ATEU ( Apollo tyres employees union) iii) ATMS ( Apollo tyres mazdoor sangh)

iv)

ATWM ( Apollo tyres workers movement)

The trade unions which get atleast 20% of vote of total strength are recognized by the management. The management has introduced a long term settlement (LTS) plan, which is nothing but a collective bargaining agreement. The decisions are taken jointly by the trade union and the management. Also a part of the HR initiative employee involving them in productivity relied issues such as quality circles and professional circle, a social gathering such as factory day and other celebrations encourage participation.

SWOT Analysis
Strengths Continued market leadership in the dominant industry segment of truck and bus tyres Global presence with the acquisition of Apollo Tyres South Africa (Pty) Ltd. (Formerly known as Dunlop Tyres International (Pty) Ltd.) Extensive distribution network in India and South Africa Strong brand recall in a price sensitive Indian market Responsive to changes in market conditions and product profiles Global quality standards, international process and system certifications

High usage of information technology systems to hasten the flow of information and leverage opportunities across 140 locations in India Dynamic and progressive leadership, willing to implement change Economies of transportation cost, on account of closeness to natural rubber growing belt Global sourcing of raw materials

Weakness No presence in two/ three wheeler segment Declining profit margins due to raw material cost push Lack of clarity in career path Lack of flexibility of jobs among workmen.

Opportunities Leadership position in the commercial vehicle segment will enable the Company to leverage new and related business opportunities New product segments like Truck/Bus Radial (TBR), Off The Road tyres (OTR), retreading and allied automotive services Growth in overseas markets like Europe

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

Cheaper imports on account of import from countries which are signatories to regional trading agreements With crude prices scaling upwards, pressure on raw material prices can be expected High expectations of labour in terms of compensation or welfare measure

Conclusion- The Future At Apollo Tyres, they believe in being in control of their destiny. They set ambitious targets and believe in stretching themselves to outperform them. Therefore, the leadership position in the Indian market notwithstanding, Apollo is now set to look overseas for new challenges. Nearly all initiatives being taken at this point in time are geared to fuel this ambition. At home and abroad, Apollo is looking to not only consolidate its leadership position in various segments through newer, high technology products but also through consistent organic and inorganic growth opportunities, in tyres and allied products. Becoming a leader in the passenger car tyre segment is a priority as is the export of passenger car radials. If the company continues to grow at the current pace, Apollo expected to reach the US$1 billion mark in less than five years. Continuous focus on cost control and operating efficiency remains the hallmark of the company. Apollo has three tyre manufacturing facilities and one unit for the production of tubes and flaps in four locations based in West and South India. Apollo endeavour has been to have the widest spread of sales and regional offices, along with stock points at locations which allow for maximum customer reach and efficient supply chain management. Apollo dealer or business partners are also chosen with great care. Apollo's products are sold through a combination of outlets ranging from exclusive dealerships to multi-brand and branded retail outlets. The continuous upgradation of dealer knowledge is in Apollo's interest and therefore their training is undertaken by the company. With a dedicated field sales,

technical and commercial force of 600, Apollo feels that they are best positioned to meet the customer specific needs.