Apollo Tyres shares decline 3% on disruption of operations at Limda plant
Apollo Tyres share price: The company said that Bias and OTR tyre production at its manufacturing facility in Limda, Gujarat, has been stopped due to certain concerns amongst shop floor employees relating to the renewal of a long-term settlement agreement.
Apollo Tyres share price: Shares of Apollo Tyres declined as much as 3.06 per cent to Rs 367.30 apiece on the BSE in the early morning trade on Thursday, September 21. The stock slipped after the company, in its regulatory filing on September 20, informed bourses that Bias and OTR tyre production at its manufacturing facility in Limda, Gujarat, has been stopped due to certain concerns amongst shop floor employees relating to the renewal of a long-term settlement agreement. The stock ended at Rs 369.70, down 2.43 per cent on the BSE.
Apollo Tyres further said that the company was in discussions and negotiations with the labour union representatives to address their concerns and find an amicable resolution.
"The company is dedicated to the welfare of its employees, the interests of its stakeholders, and the continued stability of the organization. While the company is monitoring the situation closely, there are plans in place to mitigate any supply disruptions. There is no material impact on the operations at this stage," the company added.
Foreign brokerage Morgan Stanley has maintained an 'equal-weight' rating on the stock with a target price of Rs 425. The brokerage said it believes the share price will fall relative to the country index over the next 60 days. Morgan Stanley further said that the company needs to take prices up by 4 per cent to offset the cost pressures, and the tyre industry might not raise prices this time owing to high margins already.
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