JK Tyres to hike prices by 2-4%

With rubber prices going up, tyre manufacturer JK Tyre & Industries has decided to hike price of its products by two to four per cent, a senior company executive said.

The price revision in the range of two to four per cent is inevitable and it would be made effective from the last week of this month across the country, JK Tyre & Industries Marketing Director AS Mehta told PTI in a telephonic interview.

"The raw materials prices have gone up to an all time high, touching Rs 210 or even Rs 220 per kg of natural rubber. When the price of natural rubber was enhanced Rs 180 per kg in the previous quarter we did not increase the price of tyres since market conditions were not conducive," he said.

"The current increase in rubber price is unbearable and we have decided to jack up the selling  price of all types of tyres."

To a question, he said that "third quarter results will be more or less similar to the tough Q2 or perhaps a shade better because only fourth quarter is more promising for tyre industries since the purchase of replacements are normally deferred only to the fag end of the fiscal."

The company, which clocked the next sales of Rs 3,678 crore in the year 2009-10, should be better off in the current fiscal and as well in the next few years, he said.

The JK Group is also poised for expansion and the upcoming facility at Chennai will be commissioned by the end of 2011.

In the first phase at the green site in Chennai with an investment of Rs 750 Crore, the production capacity of truck radials will be to the tune of four lakh per annum and that of car radials 25 lakh, he said.

Chennai facility is to generate job opportunities to about 1,200 people.

Similarly, for Vikrant Tyres the capacity of the manufacturing facility at Mysore has been stepped up from eight lakh to 10 lakh tyre production in a year.

Mysore plant has already commenced full-fledged production of OTRs (Off The Road tyres) after successful trial runs and in fact India's biggest OTR variety was rolled out in the first week of January. The mega tyre weighed more than 3.5 tonnes and the height was little excess to 12 feet, he said.

The company had invested Rs 120 crore for this OTR manufacturing process.