New Delhi: Apollo Tyres plans to raise tyre prices in the March quarter to maintain profit margins as raw material costs rise, a top official said on Friday.
Hardening natural rubber and crude oil prices have prompted Apollo and its peers to raise prices to protect margins in recent months. Apollo hiked prices by 5% in January and by 3% in November.
“There is every chance (of a price hike),” chief financial officer Sunam Sarkar told Reuters over the telephone.
The benefit of low-cost inventory carried over from the September quarter offset some of the rise in input cost during the December quarter, he said. Raw materials account for 70 percent of tyre-making costs.
Earlier in the day the tyre maker said profit at its India operations jumped about 19 times to Rs102 crore in the fiscal third quarter, on cost savings. Sales rose 47% to Rs1,320 crore.
A spurt in automobile sales and increased industrial activity in recent months has boosted tyre makers’ sales.
Raw material prices rose 15% in the December quarter, Sarkar said.
Shares of Apollo Tyres ended up 4.8 percent at Rs53.50 in the Mumbai market.