New Delhi – Indian tire maker JK Tyre & Industries Ltd has seen a significant rise in sales and earnings for the first quarter of the current financial year, ending 31 March 2022.
Group earnings (EBITDA) jumped from INR40 million (€460,000) to INR2.9 billion during the three months to end of June, while sales rose 130% to INR26 billion, the tire maker announced 4 Aug.
“The first quarter of this fiscal year started on a subdued note due to resurgence of second wave of the pandemic and lockdowns,” said Dr Raghupati Singhania, chairman and managing director.
Despite the challenging market conditions, he said, the group achieved “encouraging growth in revenues and profitability.”
Singhania, however, warned that the rising cost of raw materials was impacting margins and that JK Tyre was taking “judicious price increases” across its product categories to address the issue.
“We see that the raw material prices are on a rise and in second quarter also we could see there will be price increase in terms of the raw material,” he said in an earnings conference call.
As a result of the increases, the Indian group said it had already taken a price hike in the month of July and expected a further price hike of 4-5% in the near future.
As for the second quarter outlook, Singhania said his company expected “improved market conditions” due to higher vaccination rates and a sharp economic recovery.
“The July month auto sale has also indicated better offtake from the OEM as the demand has started to pick up in the rural markets,” he noted.