Three Reasons Why JK Tyre, a Low PE Trending Tyre Stock, is on a Roll!

JK Tyre is one of the low PE (11.46) Tyre stock that is trending on bourses. The stock made a fresh 52-week high on Wednesday trading session.

With the economy coming back to normalcy and opening up there is optimism across various sectors. Tyre industry is one of the several industries expected to stage a comeback not only on ground but on bourses as well. The industry can be expected to benefit from the voluntary scrappage policy and the various government’s development plans. 

JK Tyre is one of the low PE (11.46) Tyre stock that is trending on bourses. The stock made a fresh 52-week high on Wednesday trading session.

Following are the top three reasons why JK Tyre is trending on bourses:-  

1. Quality growth:- In Q4FY21, there was significant volume growth on a year-on year basis due to a strong rebound in demand backed by a sharp recovery in economic activities resulting in higher utilisation of vehicles, coupled with robust demand for passenger car radials (PCR), two and three-wheeler tyres and farm tyres in rural and suburban markets. JK Tyre’s aggressive focus on channel expansion and extraction program during the financial year is expected to pay rich dividends. 

2.Markets share: - The management’s focus on increasing market share through strengthening product positioning is helping the company improve its margins. JK Tyre has added more than 1,400 dealers and newly opened 90 exclusive brand shops to penetrate deeper into key geographies, especially in rural and suburban markets. JK Tyre has a total of 6,000 plus dealers and 650+ exclusive brand shops in India.

3.Increasing operational capacities: - JK Tyre has plans to incur about Rs 200 crore capex to debottleneck the plants over the next 2-2.5 years. This will lead to increasing the operational capacities.