Ceat outlines tire capacity expansion plans at Indian factories

Mumbai, India – Ceat Ltd has outlined the details of planned expansion project across its operations to be completed over the coming year.

The Indian tire maker’s board of directors has approved INR13 billion (€120 million) of capex for its Chennai plant, to add capacity for the production of 3.5 million of passenger car tires, said Arnab Banerjee, managing director and CEO in a 20 Jan earnings call.

The company expects the capacity addition to be progressively completed by the second half of its financial year 2028, which ends 31 March 2028.

In parallel, the company said it is expanding its Nagpur facility in central India, increasing capacity from 80,000 tires per day to 100,000 tires per day.

Ceat disclosed the INR4 billion planned capacity expansion at Nagpur last year, stating that it would increase annual production capacity by nearly 30% to 35 million units.

The expansion, it said at the time, will be geared towards two- and three-wheeler industry.

Also commenting on the capex development, finance chief Kumar Subbiah said the group’s current annual capex run-rate stands at around INR9 billion - INR10.5 billion.

This, however, is likely to increase to up to INR12.0 billion as volumes scale up on a higher base, said Subbiah.

“As you’ve seen in the first nine months our volume growth has been over 15%,” Subbiah said, adding that quarterly year-on-year growth had reached 20%.

“From a capacity creation point of view, we need to take into consideration volume growth on a higher base.”