Owing to pent-up demand in the domestic market, JK Tyre said it would require 6-8 months to service the current orders.
“The demand for passenger cars is good and they have a huge waiting period and a good order book. The present order book will require 6-8 months to service the order,” Anuj Kathuria, President of JK Tyre & Industries Ltd told businessline.
The company that has been implementing price hikes on its products owing to spikes in prices of raw materials earlier does not plan on implementing a steep price hike on its products in the coming quarter.
“As the raw material prices have softened, no steep product price hike is planned... We were compensating it (rise in raw material costs) by increasing the product prices, but now the commodities have softened. We may still have to increase the prices but it will not be as steep as it was earlier,” said Sanjeev Aggarwal, CFO.
The company’s net profit had dipped 23 per cent and revenue from operations grew 25.59 per cent, according to results it posted last week. “The reduction in profitability is in account of only exceptional items. It is because of the reinstatement of foreign currency loans. If you compare PBT and the exceptional item, it is better. The domestic demand is driving the growth and it is an indicator that the next quarters will be good,” said Kathuria.
While the company’s short-term borrowing increased due to the price hike, the long-term loan has reduced. “We have been focussing on reducing the long-term loan and it should go down by 40 per cent by 2025,” added Kathuria.
JK Tyre anticipates no big impact with the rise in inflation owing to good demand in the passenger and commercial vehicle market. “There would be some impact but there is a strong bounce in the market and a big pent-up demand. The demand for passenger cars is good and they have a huge waiting period and a good order book. The present order book will require 6-8 months to service the order,” he said.