The Hindu Business Line : JK Ind to invest Rs 120 cr to raise radial tyre capacity

JK Industries has unveiled a new roadmap that includes an investment of Rs 120 crore to increase the production of bus and truck radial tyres to 1.5 million units by 2010.

Mr Vikram Malhotra, General Manager (Sales and Marketing), told newspersons that the company plans to invest Rs 60 crore every alternate year in its Mysore plant to increase the capacity of radial tyres to 1.5 million units from the current capacity of 3.7 lakh.

The company invested Rs 60 crore this year to increase the capacity of the Mysore plant from 2.5 lakh units to 3.7 lakh.

The company makes radial tyres under the brand name, JK Tyres. The investment of Rs 60 crore during this year is part of a five-year roadmap to increase the capacity to 1.5 million radial tyres.

"There is a sustained demand for radial tyres and we want to be in a position to capture a significant share of the market," Mr Malhotra said.

JK Industries has 85 per cent market share in the radial tyre segment and the total size of the market is around 20,000 tyres per month.

Of the company's Rs 2,300-crore turnover, the Mysore plant contributed around Rs 300 crore last fiscal.

Price hike in offing

Mr Malhotra said the company is planning to increase the price of radial tyres by 2-3 per cent next month because of higher input costs. It had increased the price of radial tyres by two per cent last month. According to Mr Malhotra, Telco and Volvo and several State road transport undertakings are some of its customers. The company has also started a fleet management unit for nearly 60 fleets.

JK Industries deploys an engineer for each fleet who works out a cost management for the company. "This helps the companies to reduce their cost considerably."

By March next year, 40 more fleets will be added. JK Industries also runs tyre care centres across the country. It has already invested around Rs 4.5 crore in these centres. There are 17 such centres and 10 more will be added by March next year.

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