BKT Announces Further Significant Investment
When 95 per cent of a company’s sales are achieved in export markets, it would be well advised to ensure its presence at international exhibitions. This is the view held by Balkrishna – also known as BKT – the central business unit of India’s Siyaram Poddar Group. The last two years in particular have been a time in which the agricultural, earthmover, industrial, ATV and small tyre manufacturer has been able to distinctly expand its market share in Asia. As executive director Anurag Poddar explained during an interview with Tyres & Accessories, the company intends through its own marketing plant to further increase sales in the region. During the Tyrexpo Asia exhibition in Singapore the company displayed the first steel belt radials for earthmoving equipment to be produced in an Indian factory, and this landmark product can be used to symbolise the company’s sizeable ambitions for the Asian markets.
According to Anurag Poddar, Tyrexpo Asia was “the right platform with which to promote the growth of our company in Asia.” The show is firstly a place to meet existing customers. But more importantly, the executive director added, the exhibition was specifically used as a tool to promote the company’s market positioning; it is only in the past few years that BKT has fully taken advantage of the possibilities offered by marketing in regards to the establishment of a brand name.
A brand name alone is not enough for success in a market. Much more important is the ability to offer the right products with the right quality. To enable this, Balkrishna Industries has on an ongoing basis invested in the modernisation and expansion of capacity at its factories. Only last August the company inaugurated a new earthmover tyre factory in the state of Gujarat, following several years of planning and construction. A short time later, in December, the first new “BKT Earth Max”, the first Indian produced steel belted radial for earthmover equipment, was unveiled. In total, Balkrishna Industries invested approximately US$30 million in the factory and its “top of the line” equipment. Anurag Poddar added that the new earthmover tyre range is available in sizes between 25 and 35-inch, covering popular European fitments.
The executive director then noted the company is also currently planning another, fourth factory in India. While the extra capacity from this plant will increase the company’s overall capacity, the factory is not exclusively earmarked for the production of a specific product. And although, he commented, BKT must obviously take the global financial and business crisis into consideration, construction work on the new factory will still go ahead. Originally the company intended to commence work on the $200 million project during the course of this year, said Poddar. Construction has now, however, been delayed by up to 12 months. It is not expected that the market for agricultural tyres will come under such undue pressure as a result of current business conditions – crops will, after all, always need to be harvested. Nevertheless, Balkrishna Industries, as have a number of other companies, wishes to play it safe regarding its financial options at a time when banks are not so freely granting credit.