The new state-of-the-art manufacturing plant set up in Chennai by JK Tyre & Industries Ltd. last year at an outlay of Rs. 1,500 crores has already commenced production of a range of tyres, including those for passenger cars and utility vehicles. Production of tyres for commercial vehicles will begin soon.
With this fifth plant, the company has expanded its manufacturing operations all over India, and its four plants are located one each at Udaipur and Gwalior, and two at Mysore, according to company sources.
The Chennai facility, the most environment-friendly, will maximize the use of natural resources and is being designed to have zero carbon leakage by using a modern bulk carbon handling system. The manufacturing line has highly automated machines for zero error production and complete traceability through the bar coding system, maintaining a consistent product quality. The plant is run by world class and industry best skilled manpower that will undergo periodic theoretical and practical training.
Expanding horizons
JK Tyre is one of the largest tyre exporters from India with a worldwide customer base in over 80 countries across all six continents. International sales operate through a strong and dedicated distribution network fully supported by the company’s technical team towards continued product development to meet specific market needs.
Besides India, JK Tyre has enhanced its global footprint with the acquisition of a Mexican tyre major, Tornel, in 2008 to further strengthen its resolve for increased presence in the NAFTA trade bloc and emerging economies of Central and South America to where it has been exporting tyres from India in large volumes for over 20 years.
In addition to Mexico, in order to meet the increasing demand for its reputed tyres in the discerning global tyre markets, the company has entered into sourcing arrangements with tyre companies in China, Vietnam and Sri Lanka for various products, including truck radial tyres and bias truck / bus and LCV tyres.
JK Tyre products, marketed under the ‘JK Tyre’ and ‘Vikrant’ brands, compete with the best international players. Its bias range of products commands a premium price and image across major bias global markets and conform to international quality certifications such as TS 16949, ‘DOT’ (USA), ‘E’ mark (Europe), ‘INMETRO’ (Brazil), ‘GCC’ (Middle East Gulf), ‘SONCAP’ (Nigeria), ‘ITS’ (Kenya), ‘SNI’ (Indonesia), etc.
Jump in operating profit, PBT
JK Tyre has reported a gross sales turnover of Rs. 1,588 crores for the first quarter ended July 30, 2012. It has reported a surge in its operating profit for the quarter at Rs. 129 crores. Profit before tax was Rs. 36 crores (Rs. 3 crores).
Commenting on the results, Dr. Raghupati Singhania, Vice Chairman & Managing Director, JK Tyre & Industries Ltd., said: “The quarter has seen a significant growth compared to last year. There has been considerable improvement in profitability due to various steps such as enhancing our focus on higher realization market segments and launching many new products apart from several cost compression measures.”
Stabilization of input prices to some extent helped achieve better results. Also, the company made entry into new OEMs and enhanced the production of fast growing TBR and PCR lines. “We are optimistic about clocking good volumes on the back of strong demand for our tyres across segments and capacity expansions,” he added.
The new green Chennai plant went on stream early this year. The plant with a capacity of 25 lakh car radials and four lakh truck/bus radial tyres per annum will strengthen JK Tyre’s radial leadership. The coming quarter will have the benefit of production from this new facility, which will cater to both domestic and export markets.