JK Tyre & Industries Ltd plans to hike tyre prices by 4-5% in the current October-December quarter. Managing Director Anshuman Singhania said, "We intend to increase prices in the third quarter in the range of 4-5 per cent." The company aims to offset rising raw material and container freight costs.
JK Tyre & Industries Ltd intends to raise tyre prices by 4-5% in the current quarter. The company aims to offset higher raw material and container freight costs. This follows previous price increases of 5% and 7% in earlier quarters. The company reported a decline in profit for the July-September quarter amid challenging operating conditions. Rising costs of raw materials continue to impact the company's profit margins going forward.
New Delhi: JK Tyre & Industries Ltd plans to increase prices of its tyres by another 4-5 per cent in the current October-December quarter as the company looks to offset the impact of higher raw material and container freight costs, according to a senior company official.
"We intend to increase prices in the third quarter in the range of 4-5 per cent," JK Tyre's Managing Director Anshuman Singhania told reporters after announcing the company's second quarter results. This follows a 5 per cent increase in the first quarter, followed by another 7 per cent in the second quarter.
He noted that the operating environment remains challenging due to geopolitical tensions in West Asia. Input costs were "persistently higher", and there were supply chain constraints, including container freight rates that are significantly above historical levels.
For the July-September quarter, JK Tyre reported a 71.5 per cent on-year decline in its consolidated profit after tax to Rs 65.11 crore. Earnings before interest, taxes, depreciation, and amortisation (EBITDA) margin contracted sharply to 7.1 per cent from 13.3 per cent.
Singhania said that the cost of raw materials increased around 9 per cent in the second quarter from the first quarter and the cumulative increase over the first six months of the financial year has been around 30 per cent.
"Going further to the third quarter, we are seeing another 4-5 per cent increase in the full raw material basket," he said, while noting that the company is witnessing an improved mix of its products. According to him, larger-rim tyres are gaining traction in both the original equipment and replacement categories.