The Directors have pleasure in presenting the Annual Report along with
 the audited statement of accounts of your Company for the financial
 year ended March 31, 2011.
 
 FINANCIAL PERFORMANCE
 
                                                         Rs Million
 
                               Year Ended              Year Ended
 
                       31.03.2011  31.03.2010  31.03.2011   31.03.2010
 
                               Standalone           Consolidated
 
 Net Sales                54,905     50,366     88,677       81,207
 
 Other Income                267        112        263          214
 
 Operating Profit 
 
 (EBIDTA)                  5,603      7,949     10,042       11,963
 
 Less: Depreciation        1,474      1,228      2,719        2,542
 
 Interest                  1,493        739      1,852        1,154
 
 Provision for Tax           653      1,832      1,063        2,607
 
 Net profit before 
 
 Exceptional Items         1,983      4,150      4,408        5,660
 
 Add: Exceptional Items        -          -         -           874
 
 Less: Share of loss of 
 associates/                                        6 
 minority interest
 
 Net Profit                1,983      4,150      4,402         6,534
 
 OPERATIONS
 
 On a standalone basis, your Company registered a net turnover of Rs
 54,905 million as against Rs 50,366 million during the previous
 financial year, a growth of 9%. The Company registered EBIDTA of Rs
 5,603 million as compared to Rs 7,949 million during the previous
 financial year. The net profit for the year under review was Rs 1,983
 million, as against Rs 4,150 million in the previous fiscal. The steep
 hike in raw material prices coupled with production loss, due to labour
 problems, at one of the units had an adverse impact on the
 profitability of the Company.
 
 The consolidated net turnover of the Company as a group has increased
 to Rs 88,677 million during FY 2010-11 as compared to Rs 81,207 million
 during the previous financial year, registering a growth of 9.2 %. The
 consolidated EBIDTA was Rs 10,042 million for FY 2010-11 as compared to
 Rs 11,963 million for the previous financial year. On consolidated
 basis, the Company earned net profit of Rs 4,402 million for FY 2010-11
 as against Rs 6,534 million for the previous financial year.
 
 The amount available for appropriations, including surplus from
 previous year amounted to Rs 7,874 million. Surplus of Rs 6,469 million
 has been carried forward to the balance sheet after providing for
 dividend of Rs 252 million, dividend tax of Rs 41 million, debenture
 redemption reserve of Rs 112 million and general reserve of Rs 1,000
 million.
 
 Your Company sustained its leadership position in the Indian tyre
 industry despite challenging market conditions and production loss
 caused due to labour problem, at the Perambra unit in India, due to
 lock out from June 11, 2010 to August 21, 2010. In May 2010 there was
 also a 2-week strike at the ports in South Africa, affecting the supply
 of raw materials to the Durban and Ladysmith facilities. In September
 2010 your Companys South Africa Operations were again brought to a
 standstill by an industry-wide labour strike, which was resolved after
 prolonged negotiations.
 
 PRODUCTION
 
 During the year under review, your Companys production has shown a
 consolidated growth of 2.8%, in production tonnage, by generating an
 output of 438,524 metric tonnes (MT) as against 426,641 MT in the
 previous year.
 
 RAW MATERIALS
 
 During the year under review, raw material dynamics in the tyre
 industry have undergone a significant change, primarily from the
 perspective of key raw material prices, which have risen beyond
 expectations. Robust demand from China and India, along with resurgence
 of output in the industrialised countries, saw prices of natural rubber
 peaking to US$ 6/kg in the international market. The supply of natural
 rubber was also adversely impacted in the year due to climatic
 conditions in rubber growing regions. The domestic rubber prices
 reached an all time high of Rs 241/kg during the year, registering an
 increase of almost 70% over the prices in the last fiscal.
 
 Crude oil prices also crossed the US$ 100/barrel level on geo-political
 factors and strong demand growth from major economies across the globe.
 Crude based items, namely, synthetic rubber, nylon tyre cord fabric,
 polyester fabric, carbon black and rubber chemicals also showed a
 rising trend during the course of the year. Moreover, anti-dumping duty
 on nylon tyre cord fabric, carbon black and rubber chemicals continued.
 
 Considering that the global GDP is projected to grow at 4% in 2011-12,
 fuelling the demand for commodities and base metals, prices of major
 commodities such as natural rubber, crude oil and steel are likely to
 remain bullish.
 
 Despite a challenging environment with respect to raw materials, your
 Company strives to remain globally and regionally attractive to
 customers and investors by continuing to focus on working capital
 management, alternative energy source development, new vendor
 development and nurturing existing relationships with business
 partners. These strategic initiatives are expected to fuel your
 Companys growth across geographies.
 
 DIVIDEND
 
 The Directors are pleased to recommend a dividend of Re 0.50 (50%) per
 share on Equity Share Capital of the Company for the FY 2010-11 for
 your approval. There will be no tax deduction at source on dividend
 payments, but your Company will have to bear tax on dividend @ 16.22%,
 inclusive of surcharge.
 
 The dividend, if approved, shall be payable to the Shareholders
 registered in the books of the Company and to the beneficial owners as
 per details furnished by the depositories, determined with reference to
 the book closure from July 28, 2011 to August 11, 2011 (both days
 inclusive).
 
 MARKETING
 
 FY 2010-11 was a landmark year for Apollo Tyres Ltd. For starters, your
 Company introduced its flagship Apollo brand in the European market at,
 what is arguably the worlds largest tyre exposition, Reifen in Essen,
 Germany. Later in the year, coinciding with the opening of the
 International Geneva Motor Show or Salon International de lAuto,
 Apollo launched its biggest ever mega billboard campaign for brand
 Vredestein. During March 2011, the billboards were on view in 37 major
 European cities – placed in prime high traffic locations.
 
 In India, Apollo launched a high-voltage passenger car radial
 advertising campaign titled Road Is A Friend, which was aided by an
 aggressive consumer promotion scheme called Exchange For A Tubeless
 Future to promote the use of tubeless PCR tyres. However, the focus
 was on below-the-line promotional activities, with individual and fleet
 customers, through initiatives like Apollo ET ZigWheels Awards for
 recognising excellence amongst automakers and Apollo Safe Drive which
 promotes safe driving and tyre maintenance.
 
 Brand Dunlop, sold in 32 African countries, emerged as the # 1 brand in
 the tyre category, in a survey commissioned by Rapport and City Press
 newspapers on South Africas iconic brands. This was an independent
 survey measuring the usage of more than 8,000 brands under 19 different
 product categories by South African consumers. The South Africa
 Operations took forward their Driven By Precision position for brand
 Dunlop, by launching a new advertisement campaign.  The new
 communication positions the Dunlop Zones – exclusive retail outlets –
 as the ultimate destination for a premium tyre fitment experience and
 outstanding service from committed professionals and experts.
 
 EXPORTS
 
 Exports of passenger car radials, despite a demand slump, grew
 marginally over the previous years sales volumes. Your Company
 continues to be the largest exporter of passenger car radials from
 India with a share of over 75% vis-à-vis exports by domestic industry.
 Truck-bus cross ply sales volumes fared as per expectations; though
 price undercutting by competition and increasing preference for radial
 tyres posed to be a challenge. The year also witnessed the successful
 pilot launch of Apollos truck-bus radial tyres in select markets of
 Asia, Africa and the Middle East – this category shows tremendous
 potential for growth in the coming years.
 
 Apollos European Operations largely focus on the domestic replacement
 market and there is not much by way of exports.  On the other hand,
 your Companys South African Operations saw a healthy growth in exports
 with almost 23.7% of the current financial years revenue coming from
 this segment, compared to 17.5% in the previous year.
 
 EXPANSION PROGRAMME AND FUTURE OUTLOOK
 
 The greenfield project of the Company in Chennai, is progressing as per
 schedule. At present the facility is producing 7,500 passenger car
 radial (PCR) tyres and 2,000 truck-bus radial (TBR) tyres per day. It
 would reach its planned capacity of 16,000 PCR tyres per day and 6,000
 TBR tyres per day by the last quarter of the current financial year.
 The unit is supplying to major OEMs like Hyundai, Tata Motors, Ashok
 Leyland and Mahindra, all of whom have reviewed the product performance
 favourably. Supplies to other major OEMs like Ford, Nissan and Maruti
 Suzuki is expected to commence shortly.
 
 During the year, the cross ply light truck tyre production was enhanced
 by 1000 tyres per day to its current 2030 tyres per day, at the
 Perambra facility. Similarly, an increase in production was also
 undertaken at the Limda unit – 1581 to 2151 tyres per day for light
 truck cross ply and 351 to 651 tyres per day for rear tractor cross
 ply; resulting in the total tonnage production going up by
 approximately 36 MT/day. On the radial front, the PCR and light truck
 radial (LTR) production at the Limda facility was upped to around
 18,000 tyres per day and 2,000 tyres per day, respectively, taking the
 total radial tonnage production at the said facility to approximately
 165 MT/day.
 
 The Companys units in South Africa are in the process of further
 production building – from 10,000 PCR tyres per day to 13,000 PCR tyres
 per day at Ladysmith and from 1000 TBR tyres per day to 1200 TBR tyres
 per day at Durban. The said production increase and modernisation and
 quality improvement project includes installation of a new calender
 line, fischer cutter, triplex extruder, bead apexing and high speed PCR
 tyre building machines. The total cost of such an expansion in South
 Africa would be around Rand 275 million (equivalent to Rs 1820 million)
 and the same is expected to be completed by September 2011. However,
 the total production increase would be realised only by the last
 quarter of the current financial year.
 
 The European Operations expanded PCR capacity from 5.2 million to 6.4
 million tyres per annum, with an investment of €6 million (equivalent
 to Rs 380 million). The increased capacity is already under utilisation
 since the last quarter of the year, allowing the Company to sell higher
 volumes in the European market.
 
 MANAGEMENT DISCUSSION AND ANALYSIS REPORT
 
 As required by Clause 49 of the Listing Agreement with the Stock
 Exchanges, a detailed Management Discussion and Analysis Report is
 presented in a separate section forming part of the Annual Report.
 
 SUBSIDIARY COMPANIES
 
 As on March 31, 2011, your Company had 35 subsidiaries including
 indirect subsidiaries. During the year, the following changes have
 taken place in subsidiary companies:
 
 During the year under review, Apollo (Mauritius) Holdings Pvt. Ltd,
 your Companys subsidiary has incorporated Apollo Tyres Holdings
 (Singapore) Pte. Ltd w.e.f. September 8, 2010 and Apollo Tyres (Middle
 East) FZE w.e.f. January 2, 2011 as its wholly owned subsidiaries.
 
 The main activity of the Middle East Company will be warehousing and
 trading of tyres manufactured at various locations in India, South
 Africa and the Netherlands to cater to customers in Middle Eastern and
 African countries.
 
 Apollo Tyres Holdings (Singapore) Pte. Ltd acquired 95% shareholding in
 K P Construction and Forestry Development Co.  Ltd (name being changed
 to Apollo Tyres (Lao) Company Ltd) w.e.f. February 15, 2011 which would
 be engaged in business of natural rubber plantations.
 
 Vredestein Kft your Companys step subsidiary in Hungary through Apollo
 Vredestein B V formed a wholly owned subsidiary of Vredestein Ro SRL
 w.e.f. August 18, 2010.
 
 Apollo Tyres (Pte) Ltd ceased to be the subsidiary Company of Apollo
 (Mauritius) Holdings Pvt. Ltd w.e.f. June 4, 2010.
 
 The Ministry of Corporate Affairs vide its letter No: 5/12/2007-CL-III
 dated February 8, 2011, has granted a general exemption to the
 companies under section 212(8) of the Companies Act, 1956 from
 attaching a copy of the balance sheet and the profit and loss account
 of the subsidiary companies, and other documents, to the Annual Report
 of the companies, subject to fulfilment of certain conditions specified
 in the aforesaid circular.
 
 The annual accounts of the subsidiary companies will be made available
 to Shareholders on request and will also be kept for inspection by any
 Shareholder at the Registered Office and Corporate Headquarters of your
 Company, and its subsidiaries.
 
 The consolidated financial statements presented by the Company include
 the financial statements of each of its subsidiaries. As required,
 pursuant to the provisions of Section 212 of the Act, a statement of
 the holding Companys interest in the subsidiary companies forms part
 of the Annual Report.
 
 In view of the ongoing economic uncertainty in Zimbabwe and the long
 term restriction on financial repatriation, the accounts of Zimbabwe
 based entities have not been consolidated under Accounting Standard (AS
 21) ‘Consolidated Financial Statements. Please refer to note 3 (c) of
 schedule 12 of the consolidated accounts.
 
 FIXED DEPOSITS
 
 Your Company is not accepting fixed deposits from the public /
 Shareholders.
 
 In respect of deposits accepted earlier, cheques had been issued for
 the principal amount and interest thereon amounting to Rs 1.31 million,
 which remained unencashed as on March 31, 2011.
 
 AUDITORS
 
 M/s Deloitte Haskins & Sells, Chennai, Chartered Accountants, Statutory
 Auditors of your Company, will retire at the conclusion of the ensuing
 Annual General Meeting and be eligible to offer themselves for
 reappointment as Statutory Auditors for FY 2011-12.
 
 AUDITORS REPORT
 
 The comments on the statement of accounts referred to in the report of
 the auditors are self explanatory.
 
 COST AUDIT
 
 M/s N P Gopalakrishnan & Co., cost accountants, have been appointed as
 cost auditors to conduct an audit of the Companys cost records, for
 the year ended March 31, 2011, with the approval of the Central
 Government. They will submit their report to the Board of Directors,
 before forwarding it to the Ministry of Corporate Affairs, Government
 of India.
 
 BOARD OF DIRECTORS
 
 The Government of Kerala nominated Dr A K Dubey in place of P
 Prabakaran on the Board of the Company w.e.f. March 26, 2011. Mr Mike J
 Hankinson resigned from the Directorship of the Company w.e.f. April 2,
 2011. The Board places on record its appreciation for the contribution
 made by Mr Mike J Hankinson during his tenure of Directorship.
 
 Mr Shardul S Shroff has been appointed as an additional director of the
 company w.e.f. May 11, 2011. He holds office till the date of the
 ensuing Annual General Meeting. The Company has received requisite
 notice together with deposit, as provided under Section 257 of the
 Companies Act, 1956, from a Shareholder proposing the appointment of Mr
 Shardul S Shroff as a director liable to retire by rotation.
 
 In accordance with the provisions of the Act and Articles of
 Association of the Company, Mr T Balakrishnan, Mr Robert Steinmetz and
 Mr A K Purwar, Directors of the Company, are liable to retire by
 rotation and being eligible, offer themselves for re-appointment.
 
 None of the Directors are disqualified under Section 274(1)(g) of the
 Companies Act, 1956.
 
 AWARDS AND RECOGNITIONS
 
 In its constant quest for growth and achievement, your Company was
 honoured and recognised at various forums.  The prominent Awards are
 listed below for your reference.
 
 Name of the Award         Category                Awarded By
 
 Top Company of the Year 
 Award                     Tyre Sector       Dun & Bradstreet - Rolta
                                             Corporate Awards 2010
 
 Safety Award 2010 for     Large Factories   Department of Factories and
                                             Boilers, Government
 
 Perambra Unit                               of Kerala
 
 Gold Certificate of Merit 
 for                       Process Sector,   The Economic Times Indian
                                             Manufacturing Excellence
 
 Limda Unit                Large Category    Awards 2010 in Partnership 
 
                                             with Frost and Sullivan
 
 Best Innovative 
 
 Practices                 Innovation        Todays Travellers 
 
                                             Awards 2010
 
 
 CORPORATE SOCIAL RESPONSIBILITY
 
 Your Company is a responsible corporate citizen, and strives to create
 value for the communities it operates in. A detailed report on the
 Companys community efforts form part of the Annual Report.
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS
 AND OUTGO
 
 Particulars required under Section 217(1)(e) of the Act, read with the
 Companies (Disclosure of Particulars in the Report of Board of
 Directors) Rules, 1988, regarding conservation of energy, technology
 absorption and foreign exchange earnings and outgo, are given in
 Annexure A, forming part of this Report.
 
 CORPORATE GOVERNANCE REPORT
 
 An organisations Corporate Governance philosophy is directly linked to
 its excellence in performance. Keeping this important dictum in view,
 your Company has always placed major thrust on managing its affairs
 with diligence, transparency, responsibility and accountability.
 
 The Company is committed to adopting and adhering to established
 world-class corporate governance practices. The Company understands and
 respects its fiduciary role and responsibility towards its stakeholders
 and society at large, and strives to serve their interests, resulting
 in creation of value and wealth for all stakeholders.
 
 The compliance report on corporate governance and a certificate from
 M/s Deloitte Haskins & Sells, Chennai, Chartered Accountants, Statutory
 Auditors of the Company, regarding compliance of the conditions of
 corporate governance, as stipulated under Clause 49 of the Listing
 Agreement with the Stock Exchanges, is attached herewith as Annexure B
 to this Report.
 
 PARTICULARS OF EMPLOYEES
 
 In terms of the provisions of Section 217(2A) of the Companies Act,
 1956, read with the Companies (Particulars of Employees) Rules, 1975,
 the names and other particulars of the employees are set out in
 Annexure C to the Directors Report.
 
 DIRECTORS RESPONSIBILITY STATEMENT
 
 As required by Section 217 (2AA) of the Companies Act, 1956, your
 Directors state that: 
 
 i) In preparation of the annual accounts for the year ended March 31,
 2011, the applicable accounting standards have been followed and there
 has been no material departure; 
 
 ii) The selected accounting policies were applied consistently and the
 Directors made judgements and estimates that are reasonable and prudent
 so as to give a true and fair view of the state of affairs of the
 Company as of March 31, 2011, and of the profit of the Company for the
 year ended as on date; 
 
 iii) Proper and sufficient care has been taken for the maintenance of
 adequate accounting records in accordance with the provisions of the
 Companies Act, 1956, for safeguarding the assets of the Company and for
 preventing and detecting fraud and other irregularities; and 
 
 iv) The annual accounts have been prepared on a ‘going concern basis.
 
 
 ACKNOWLEDGEMENT
 
 Your Company has been able to operate efficiently because of an
 organisational culture which upholds professionalism, integrity and
 continuous improvement across all functions, as well as efficient
 utilisation of the Companys resources for sustainable and profitable
 growth.
 
 Your Directors wish to place on record their appreciation to the
 respective State Governments of Kerala, Gujarat, Haryana and Tamil
 Nadu, and the National Governments of India, South Africa and the
 Netherlands. We also thank our customers, business partners, members,
 bankers and other stakeholders for their continued support during the
 year. We place on record our appreciation of the contribution made by
 all employees towards the growth of your Company.
 
                           For and on behalf of the Board of Directors
 
 Place: Gurgaon 
 
 Date: May 11, 2011
 
                                        (Onkar S Kanwar) 
 
                                  Chairman & Managing Director