In conversation with Sanjeev Aggarwal, CFO, JK Tyre and Industries Ltd

We are dedicated to driving premiumisation by expanding our TBR, PCR, and EV tyre portfolio, focusing on high-performance, fuel-efficient products and advanced tyre technologies, voices Sanjeev Aggarwal, CFO, JK Tyre & Industries Ltd.

How did the company perform in Q3FY25, and what are its growth targets for the coming years?

During Q3FY25, JK Tyre witnessed healthy growth in the replacement market while OEM demand remained moderate. The company achieved a consolidated turnover of RS 3,694 crore and recorded Profit after Tax (PAT) of Rs 57 crore.

Looking ahead, demand in the replacement market is promising, and the OEM sector is on a recovery path supported by the government's resumption of infrastructure spending and the increasing personal mobility needs of new-age consumers. With the continued shift towards premiumisation in the auto sector and our capacity expansion plans, we are well-positioned to strengthen our market presence in the coming years.

Additionally, we aim to reinforce our leadership in the EV tyre segment, particularly for electric buses and passenger vehicles, while driving export growth through cutting-edge technology and customer-focused solutions.

Have recent price revisions positively impacted margins, and does the company plan further increases?

At JK Tyre, we have consistently followed a disciplined pricing approach, ensuring market competitiveness while managing input cost inflation. Our recent price revisions have improved Net Sales Realisation (NSR), partially mitigating the impact of rising raw material costs.

We continue to assess market dynamics to take further price increases closely. While there is an under-recovery of around 5 per cent, we are ring-fencing our margins against the higher raw material prices by optimising the product mix, increasing volumes and enhancing operational efficiencies.

Can you provide insights into the company’s product portfolio and revenue distribution across product lines and markets?

JK Tyre offers a comprehensive product portfolio catering to segments including passenger cars, EVs, Truck & Bus, off-highway, 2/3 wheeler tyres, farm tyres etc. The company pioneered radial tyre technology in India and focuses on premiumisation, sustainability, and promoting smart mobility. Innovative products like Puncture Guard tyres, Fuel Efficient, and Ultra High-Performance (UHP) tyres underscore its commitment to cutting-edge technology and customer-focused solutions. JK Tyre was the first to develop a PCR tyre with 80 per cent sustainable materials.

In terms of revenue distribution, the commercial vehicle and passenger segment contributes nearly 85 per cent of the revenues, and other segments comprising farm, industrial and 2/3 wheeler tyres contribute the remaining 15 per cent. The company is a leading CV player, contributing more than 50 per cent to the revenue.

In terms of markets, more than 60 per cent of revenue is derived from replacement markets, while OEM and exports also contribute to the remaining revenues.

How has the market responded to recent product launches, mainly the new EV tyre range?

Our EV tyre range is trusted by leading OEMs, including JBM, Tata Motors, Olectra, Ashok Leyland, and VECV. Our partnership with EKA Mobility is a testament to our high-performance EV-specific tyres for commercial vehicles. Further, our collaboration with Vertelo enables connected mobility solutions using advanced EV tyres integrated with Treel sensors for real-time monitoring.

Our recently launched next-generation tyres in PV, CV, 2/3W segment have garnered strong customer response. Notably, the revolutionary JETWAY JUXe, designed for electric buses, has gained significant traction due to its low rolling resistance, enhanced durability, and optimised noise reduction, making it a preferred choice among leading OEMs.

In December 2024, we introduced five advanced OTR tyres for mining equipment engineered for exceptional durability and superior performance in the most challenging terrains. This new product range in the off-the-road segments has been well received.

What are the company’s top three strategic priorities, and are there any upcoming capital expenditure plans?

Our strategic priorities include a focus on product premiumisation, market expansion and sustainability.

We are dedicated to driving premiumisation by expanding our TBR, PCR, and EV tyre portfolio, focusing on high-performance, fuel-efficient products and advanced tyre technologies.

To strengthen market reach and distribution, we are continuously expanding our dealer network of more than 6000, including more than 900 exclusive brand shops, with further growth plans underway.

Sustainability remains a top priority, with a goal to achieve 100 per cent renewable energy by 2050. Recently, JK Tyre has become the first Indian tyre manufacturer to join the RE100 club, reaffirming its commitment to sustainability.

We actively integrate sustainable materials and digital solutions to enhance operational efficiency and product innovation. In line with our efforts, we are the first company to have developed a PCR tyre, - UX Green, with 80 per cent sustainable materials.

How do you view the long-term growth potential of India’s automobile and tyre industries, and how is the company positioning itself to seize emerging opportunities?

The Indian automobile industry continues to remain one of the key drivers of growth of our economy, which is the 3rd largest in the world and is expected to become No. 1 in the next 5 years.

The Indian automobile industry continues to exhibit strong long-term growth, driven by increasing demand for vehicles, rapidly improving road infrastructure, and the transition to electric mobility.

The Indian economy is projected to grow by around 6.6 per cent, which remains the highest GDP growth rate globally. The sustained momentum in passenger, two-wheeler, and commercial vehicle segments, supported by the overall improved economic landscape and the government’s thrust on infrastructure spending and policy support, are all expected to drive the demand for the auto & tyre industry.

At JK Tyre, we are well-positioned to capitalise on this growth opportunity through innovative and advanced products. By leveraging our R&D capabilities, Superior quality products and customer-centric approach, we aim to strengthen our market leadership and long-term success.