MRF vs Apollo Tyres: Which is Better?

The Indian auto industry is a powerhouse driven by a thriving tyre sector that keeps its wheels turning. The Indian tyre industry showcases a diverse range of companies, each with its unique strengths and specialities. 

In today’s blog, we will compare MRF and Apollo Tyres.

MRF Overview

MRF is an Indian multinational tyre manufacturing company with its headquarters in Chennai, Tamil Nadu. Founded in 1946 by K.M. Mammen Mappillai, it started as a toy balloon manufacturing unit and has grown into a tyre giant. The company manufactures a wide range of products, including tyres for two-wheelers, cars, trucks, and even airplanes. It also manufactures tyres, treads, tubes, conveyor belts, paints, and toys.

MRF is the largest tyre manufacturer in India and ranks among the top 20 globally. They are well-recognized for their high-quality tyres and extensive reach across the country.

It was incorporated as a private company, Madras Rubber Factory Limited, and began tyre production in partnership with an American company, Mansfield Tire & Rubber Factory.

MRF has a wide distribution network in India, serving retail stores, dealerships, and car manufacturers. The company sells tyres directly to manufacturers (B2B) for factory use and also has a strong presence in the replacement tyre market for individual consumers (B2C).

They achieve this reach through an extensive network of franchised stores and dealers. The company focuses on offering excellent customer service through initiatives like roadside assistance programs and informative resources on its website.

Apollo Tyres Overview

Apollo Tyres Limited is an Indian multinational tyre manufacturing company headquartered in Gurgaon, Haryana. The company was established in 1972 by Onkar Kanwar, and since then, it has grown from a domestic Indian company to a global tyre manufacturer with a presence in over 100 countries. Apollo caters to a wide range of segments, including passenger vehicles, two-wheelers, trucks, buses, and light trucks.

In the 1990s, Apollo Tyres expanded globally with an ambitious strategy. The company acquired manufacturing facilities in the Netherlands in 2009 to better serve the European market.

The company employs a multifaceted business model, successfully integrating manufacturing, branding, and a customer-centric approach. This strategic blend enables the company to effectively compete in the highly competitive global tyre market.

Company’s Comparative Study

Particular	MRF	Apollo Tyres
Current Share Price	INR 1,38,616	INR 504
Market Capitalization (in INR Crores)	58,773	32,025
52 Week High Price	INR 1,51,445	INR 568
52-Week Low Price	INR 1,06,391	INR 365
FIIs Holdings (%)	19.08	14.46
DIIs Holdings (%)	10.74	26.69
Book Value per Share	INR 39,384	INR 219
PE Ratio (x)	28.5	18.8

Read Also: Apollo Hospitals Case Study : Business Model, Financial Statements, And SWOT Analysis

Financial Statements Comparison

Income Statement Comparison (FY 2024)

Particular	MRF	Apollo Tyres
Sales	25,169	25,377
Total Income	25,486	25,531
Total Expenditure	22,345	22,485
Net Profit	2,081	1,721

Balance Sheet Comparison (FY 2024)

Particular	MRF	Apollo Tyres
Non-current Liabilities	2,436	6,011
Current Liabilities	7,710	7,043
Non-current Assets	16,300	17,930
Current Assets	10,550	9,028
Total Shareholder Funds	16,703	13,902

Cash Flow Statement Comparison (FY 2024)

Particular	MRF	Apollo Tyres
Cash Flow from Operating Activities	3,300	3,439
Cash Flow from Investing Activities	-2,379	-710
Cash Flow from Financing Activities	-868	-2,659

Key Performance Indicators

Particular	MRF	Apollo Tyres
Net Profit Margin (%)	8.26	6.78
ROE (%)	12.46	12.38
ROCE (%)	16.40	15.68
Current Ratio	1.37	1.28
Debt to Equity Ratio	0.12	0.28

Conclusion

The comparison between MRF and Apollo Tyres presented above leads us to conclude that while both MRF and Apollo Tyres have comparable sales, MRF posts higher net profit margins. Moreover, MRF has a slightly higher ROE and ROCE metric as compared to the metrics of Apollo Tyres. However, it is advised to speak with an investment expert before making investment decisions.

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