Midcap Tyre Manufacturer Reports 44 per cent Decline in Q2 Earnings

JK Tyre’s quarterly net profit stood at Rs 135.04 crore in September 2024, down significantly by 44.22 per cent from Rs 242.11 crore recorded in the corresponding quarter of the previous year.

JK Tyre & Industries, a prominent player in the tyre manufacturing sector, reported net sales of Rs 3,621.56 crore for the September 2024 quarter, marking a 7.08 per cent decrease from Rs 3,897.53 crore in the same period of the previous fiscal year. This decline in revenue reflects a challenging demand environment and competitive market pressures impacting the tyre industry.

Q2 FY25 Financial Performance

JK Tyre’s quarterly net profit stood at Rs 135.04 crore in September 2024, down significantly by 44.22 per cent from Rs 242.11 crore recorded in the corresponding quarter of the previous year. The company attributed this sharp decline to lower sales volumes and increased operating costs.

The company’s EBITDA also witnessed a contraction, falling by 25.81 per cent to Rs 442.85 crore from Rs 596.93 crore in Q2FY23. Furthermore, the EBITDA margin decreased by 308 basis points compared to the same quarter last year, underscoring the pressures from both subdued demand and increased raw material costs.

Earnings per share (EPS) for the quarter dropped to Rs 4.93, a steep decline from Rs 9.33 in the same quarter of the previous fiscal year.

Stock Price Performance

The stock’s performance has remained subdued, with the share price down 1.66 per cent over the past week. Over a six-month period, the stock has shown a marginal decline of 1.00 per cent and is down by 1.76 per cent year-to-date. In the past year, the stock has underperformed the Nifty 50 index; while JK Tyre gained 15.08 per cent, the Nifty 50 surged by 26.18 per cent during the same period. The company’s market capitalization stands at Rs 10,777.21 crore.

Disclaimer: This article is for informational purposes only and not investment advice.