JK Tyre net profit crashes 80% to INR 38.4 crore in Q4, Auto News, ET Auto
New Delhi: JK Tyres & Industries Friday reported an 80% decline in consolidated net profit at Rs 38.43 crore for the fourth quarter ended March 31, 2022.
The company had posted net profit of INR 196.02 crore in the corresponding period of last financial year.
Revenues from operations in the period under consideration rose 13.15% to INR 3,312 crore.
According to Raghupati Singhania, Chairman and Managing Director (CMD), there is a good demand for pick-up post unlocking of the Covid restrictions, resulting in higher volumes in commercial vehicle and passenger car tyre segments. “Exports contributed significantly to the top-line and were higher by about 60% viz-a-viz last year,” Singhania said.
He further said that the extraordinary input cost increase in FY22 has impacted the company’s margins despite all round cost reduction and efficiency improvement measures as well as price increases taken from time to time in all tyre categories. “We hope that the inflationary pressures will taper down post resolution of the geopolitical tensions and supply chain disruptions,” Singhania added.
He also mentioned that the company’s subsidiaries – Cavendish Industries Ltd. and JK Tornel, Mexico have made significant contributions to the revenues. Both the entities have attained all time high sales for FY22, the company claimed.
On the outlook, the company is optimistic on the domestic tyre industry as it foresees improvement in infrastructural activities, higher automotive demand and better external environment. “The company has undertaken an expansion of its PCR capacity at a cost of INR 530 crore. The additional volumes are expected to be available by the end of 2023 and will enhance sales and profitability,” Singhania highlighted.
At present, JK Tyre is operating in 105 countries with over 180 Global distributors. The Company has 12 globally benchmarked ‘sustainable’ manufacturing facilities – 9 in India and 3 in Mexico – that collectively produce around 32 million tyres annually. It also has a strong network of over 6000 dealers and 650+ dedicated Brand shops called Steel Wheels and Xpress Wheels.