JK Industries to Double OTR Production

JK Industries Ltd. plans to invest up to 1.2 billion rupees (£13.9 million) doubling production of OTR tyres over the next 18 months, according a senior official from the company. This decision is a logical one for the tyremaker, owing to the fact that the net profit margin for the OTR segment is 6 per cent, nearly three times that of truck and passenger car tyres.

The company currently makes about 2,000 such tyres a month, and according to JK Industries Ltd’s finance director, A.K. Kinra, “India’s infrastructure growth is boosting demand for off-the-road tyres.” He added that the company are “getting aggressive in the segment.”

Revenue in the OTR segment is expected to pass 2 billion rupees £23.1 million) after the expansion, in contrast with the 1 billion rupees £11.6 million) , Kinra added. The company, which sells tyres under the JK Tyre and Vikrant brands, reported total sales of 26.09 billion rupees (£301.4 million) during the year up to September 2006.