New Delhi, India -- JK Tyre has announced that it will invest a total of Rs 11 000 million (â‚¬198.5 million) in the next three years - Rs 1200 million specifically going towards doubling capacity for OTR tyres by 2010.
JK, whose current capacity for OTR tyres is 25000 per annum, said in a 24 July statement that funding for the investment would be raised through internal accruals and debts. The company is also looking at expansion across the four existing facilities located in Mysore (2), Kankroli and Banmore.
â€œFollowing the booming economy, we foresee immense potential for new capacity in the OTR segment,â€ said Raghupati Singhania, vice chairman and managing director of JK Tyre Industries Ltd, in the statement.
â€œIt is for this purpose that JK Tyre & Industries invested close to Rs 1200 million to expand its capacity in this segment by almost 50 percent. The Indian automobile sector has been on the high growth spree from the last few years, offering a great opportunity and indicating at the immediate and long term potential. We are looking towards expanding our capacity across our manufacturing facilities, so that we can best cater to this demand and continuously drive our growth. In addition, we plan to effectively service and expand exports to markets that span over 70 countries.â€
JK believes that the truck/bus segment is expected to grow seven fold to 15 percent from two percent in the next five years following a significant improvement to the quality of roads, newer highways, and implementation of the golden quadrilateral road system, amongst other things
In the passenger radial segment, the company has expanded production capacity to 4.5 million tyres per annum and plans to invest about Rs 2000 million in further expanding production facility, through brownfield expansion at its radial plant in Mysore.ss