JK Tyre & Industries is the flagship company of the JK group headed by Dr R P Singhania as its chairman and managing director. It is one of the leading tyre manufacturers in India and amongst the top 25 manufacturers in the world with a wide range of products catering to diverse business segments such as Truck/Bus, LCV (Light commercial vehicles), Passenger Cars, MUV (Multi utility vehicles) and Tractors.

Company has 40+ years of experience in Tyre manufacturing and it has 11 manufacturing plants with total manufacturing capacity of 35 Mn. Its 8 manufacturing plants are strategically located in Rajasthan, Uttarakhand, Chennai, Mysore and MP. Company also has 3 global manufacturing facilities located in Mexico.  

Company is pioneer of radial technology in India and No. 1 Truck/Bus Radial (TBR) manufacturer and 19th Ranked among top tyre companies Globally. It is the 1st company in India with OE fitment of tubeless passenger radials, 1st company in India to launch high-performance H, V and Z-rated passenger radial tyres and even first in India to launch Tyre Pressure Monitoring System (TPMS) based on sensor technology.

The company has 800+ SKUs which includes tyres for passenger cars, tractors, trucks & buses, OTR, 2-wheelers etc. for 25+ OEM Clients such as Maruti, Kia, Tata, Hyundai, JBM, Force, L&T, Ace, TVS, Bajaj, Hero etc. The company is also focusing on premiumizing of products across its portfolio to generate higher revenue and earn profits in upcoming years.

It has global market presence across 100+ countries. It has a strong network of 6,000+ Dealers & Distributors, 850+ Brand Shops, 45+ Mobility Customers, 1,400 Fleet Operators, 82 Retread Centres and 140+ Sales, Service & Stocking Points in India. In overseas company has 138 Dealers and 67 Distributors in Mexico, 72 Distributors in North and Latin America, 37 Distributors in Africa and 63 distributors in Middle east and South east Asia as of Q2FY25.

Company has strong R&D capabilities through its own centre; Raghupati Singhania Centre of Excellence at Mysore. It is Asia's first and India’s foremost highly versatile Tyre / Elastomer Institute with ~200 R&D and Technology scientists.

Fundamentals:

Financial Results:

Company has reported Revenue of 3643 Cr. in Q2Fy25 and 7298 Cr. in H1Fy25 marking 7% and 45 dip in revenue on YoY basis respectively. It has reported 144 Cr. and 356 Cr of PAT in Q2Fy25 and H1Fy25 and marked fall of 42% and 13% on YoY basis. Its EBITDA also dropped by 26% and 10% as on Q2Fy25 and H1Fy25 on YoY basis.

Key Highlights:

1. JK Tyre & Industries has recently introduced an advanced range of tyres designed to meet the evolving needs of the transportation sector. JK Tyre plans to further strengthen their Truck & Bus Radial range with four new variants: JETWAY JUM XM, JETWAY JUC XM, JETSTEEL JDC XD, and the revolutionary JETWAY JUXe for electric buses. The expansion of its product portfolio underscores JK Tyre's dedication to providing advanced, high-performance solutions that combine superior performance, economic benefits, and environmental responsibility.
2. Recently the company has been recognized as the first tyre manufacturer in the country to receive the prestigious International Sustainability & carbon Certification (ISCC) Plus for its Chennai plant. This certification underscores the company’s commitment to integrating sustainability into the manufacturing processes and promoting an environmentally conscious future.
3. The company has recently inaugurated its 12th brand shop for commercial vehicles in Maharashtra, enhancing their last mile presence in the State, spread over 4,500 square feet and strategically located on State Highway 48 (PanvelKanyakumari), this cutting-edge one-stop shop is designed to deliver best-in-class customer solutions to commercial vehicle owners.
4. It has recently joined forces with EKA Mobility, a leading player in the electric mobility sector with Mitsui Co., Ltd. (Japan) & VDL Groep (Netherlands) as equity partners. This collaboration further solidifies JK Tyre’s position as the industry leader in providing "Connected Mobility Solutions," a first-of-its-kind cloud-based monitoring system. The company provides comprehensive tyre management through their mobility solutions program.
5. The company had also showcased its wide range of advanced products, backed by technological excellence at India’s first Bharat Mobility Global Expo 2024. Themed 'Innovation For The Future,' JK Tyre's product exhibit highlighted its commitment to bringing in technological advancements. The company displayed its highly sustainable tyre ‘UX Green’ made of 80% sustainable materials along with it a selection of EV Tyres on display. The company also showcased complete range of product including flagship offerings like the Smart Tyre and Puncture Guard Tyres for Passenger Vehicles, the X-series (Xtra Fuel efficient, Xtra Mileage, Xtra Durability) product line for the Commercial Vehicles market, amongst other products.

Its last 3 years stock price CAGR stands at 41% with compounded profit growth of 40% and compounded sales growth of 18% in same period.  

The Indian tyre industry is experiencing significant growth, projected to more than double its revenue in the next decade, reaching $22 billion by FY32, primarily driven by the expanding automotive sector, rising disposable income, and government initiatives promoting electric vehicle usage; with a CAGR of around 5% expected in the coming years. The Indian tyre market is expected to reach around 253.9 million units by 2032. Considering the growth in entire industry and company’s past performances and expansion plans for upcoming years, investors can invest in this company for long term period with buy in dips strategy.

HET ZAVERI​

info@smartinvestment.in

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