JK Tyre & Industries Ltd. (JK Tyre) has embarked upon an ₹790 crore expansion plan to meet its growing demand of passenger car radial (PCR) and truck bus radial (TBR) tyres, said its India president Anuj Kathuria.
“The expansion work has commenced and both these projects would be commissioned in phases by the second half of FY24,” he said in an interview.
According to him, the expansion at Banmore in Gwalior entails an investment of ₹530 crore and it will enhance the production capacity of passenger car radials by 17% to 16 lakh tyres.
The ₹260-crore expansion of truck and bus radials of its subsidiary Cavendish Industries also at Gwalior is set to enhance the production capacity by 24% to 3.42 lakh tyres, he said.
The project cost will be met through debt and internal accruals, said CFO Sanjeev Aggarawal.
On Friday, the tyre major reported a 24% increase in its consolidated net profit for the quarter ended December to ₹67 crore from the year-earlier period due to softening of raw material prices, cost control measures and price revisions.
Revenue from operations grew from ₹3,076 crore to ₹3,613 crore. The result included a forex loss and VRS expense of ₹14 crore, Export revenue stood at ₹500 crore.
“Going forward, we believe tyre industry is set to witness healthy demand in the domestic market emanating from improved vehicle utilisation and thrust on infrastructural development,” said CMD Raghupathi Singhania.