India’s JK Tyre & Industries Ltd. has reported a consolidated net profit of Rs 4.64 billion (£47.7 million) for the financial year ending 31 March 2016, a 41 per cent year-on-year rise over the previous fiscal. Consolidated turnover amounted to Rs 76.54 billion (£786.9 million). On a standalone basis, JK Tyre achieved turnover of Rs 65.80 billion (£676.5 million), a year-on-year increase of 58 per cent. In light of this improved performance, the company’s Board of Directors has recommended a dividend of 125 per cent on JK Tyre’s equity shares, pending approval at the tyre maker’s Annual General Meeting.
Commenting on the results, JK Tyre chairman and managing director, Dr Raghupati Singhania, said: “JK Tyre had a robust year with profits at its highest, during the year. With [the] auto industry taking off to a positive start in 2016, the outlook for the current fiscal is promising and we are confident of strengthening our position further this year. The company has performed well despite challenges from the dumping of cheap Chinese tyres and a surge in rubber prices.”
JK Tyre also provided an update on recent growth projects; the Rs 14.30 billion (£147.0 billion) expansion of commercial vehicle and passenger car tyre production capacity at its Chennai plant was completed during the previous financial year, as was a 50 per cent expansion of passenger car tyre capacity at the company’s JK Tornel facility in Mexico.
Regarding the acquisition of Cavendish Industries Ltd., which operates three modern tyre plants at Laksar, near Haridwar, Singhania commented: “With the acquisition of Cavendish Industries in April 2016 we have not only forayed into the two and three-wheeler segments but have also scaled up our capacities in the existing segments. The additional capacity will further consolidate our position in the TBR segment, where we already are leaders.”
Following the Cavendish acquisition, JK Tyre now owns a total of 12 production facilities – nine in India and three in Mexico. The company says the acquisition is “in line with the strategic vision of JK Tyre emerging as one of the leading global tyre companies with a comprehensive portfolio to cater to the domestic and global markets across all segments of vehicles.”