A healthy pick up in the demand in auto sector in the face of a visible economic recovery, is likely to help the country’s tyre industry to clock a seven to eight per cent growth in FY11.
Also, in line with the pick up in business growth, tyre companies are likely to make significant increase in their capex plans in 2010-11, to expand capacity and meet product demand, top players today said.
“The Indian tyre industry may grow at around seven to eight per cent at Rs. 27,000 crore in the next financial year from 25,000 crore presently, on the back of a high demand in the automobile sector,” JK Tyre & Industries, Director (Marketing), A S Mehta, told PTI here.
JK Tyres, which is one of the leading players in the domestic market, aims at a growth of 20 per cent in the next one year, has chalked out an investment plan of Rs 1,200 crore over the next two years to expand production in its car and truck radial segment.
“Year 2010 is going to be a happening year for us. We plan to invest Rs 1,200 crore in CY 10—11 to increase car and truck radial production in India,” Mehta said.
Echoing a similar view, another leading Tyre manufacturer Ceat said it has a targeted to achieve a revenue of Rs 3,500 core in the next financial year.
“The industry is likely to grow over seven per cent and we are expecting over Rs 3,500 crore revenue next year from both the domestic and global market,” Ceat’s Executive Director, Marketing, Anarb Banarjee, said.
“Ceat is expecting more Rs. 3,500 crore revenue in CY 2010 from both the domestic and global market,” Banarjee said.
Ceat plans to set up a new plant spending over Rs. 650 crore in the next financial year, besides expanding its existing plant in Nashik, he said.
“We will invest over Rs. 650 crore in 2010 to set up a new plant and will expand our existing plant in Nasik. The new plant is likely to start operations by September 2010,” Banarjee said.
The company expects the demand in the domestic market to pick up in the New Year and was hopeful to achieve a rapid growth in its business.