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Rubber King Tyres India: King Of The Road

Rubber King manufactures and markets a range of inner tubes, curing air bags and rubber flaps under the brand name “Rubber King”. The company has two factories and manufacturing capacities of 150,000 tubes per month and 75,000 flaps per month.
Rubber King inner tubes are made from high quality butyl rubber for better air retention and resistance to degradation from ozone. The size range is very comprehensive, with tubes available for truck and bus, light truck, agricultural, OTR and passenger vehicles for both bias ply and radial tyres and also for industrial vehicles and implements. Butyl curing bags and flaps are produced in a large number of sizes.
As well as these products, Rubber King offers the “Tire King” brand of tyres for vehicles from motorcycles through agricultural, industrial and OTR tyres.

The company exports products all over the world to more than 33 countries; not only in Asia, but to Europe, the USA, Africa and the Middle East. The quality of Rubber King inner tubes is demonstrated by the fact that many of the company’s customers are OEM tyre companies and the tubes carry a two-year warranty.

6th August 2007/by Tyrepress Editors

Dunlop India Embroiled in Factory Land Dispute

Dunlop India’s fortunes continue to slide to a new low as the company, on top of the recent cessation of production at its Sahagunj plant, becomes entangled in a land dispute. The quarrel with real estate company VGN Enterprises surrounds a small portion of the 60.86 acre Chennai plant plot auctioned off by Dunlop India in 2004 in compliance with a Board of Industrial and Financial Reconstruction (BIFR) rehabilitation scheme.

The tyremaker claims the land in question could not be sold under the BIFR scheme, however the buyer, VGB Enterprises managing director V N Devadoss, is adamant that any right Dunlop India may have once had to the land has been relinquished. VGB Enterprises paid Rs 234.4 million (£2.96 million) for the parcel of land, and plans to develop the land into an integrated township. Mr. Devadoss has supported his ownership claim with the land’s title deed, court cases settled in his favour and an affidavit filed by Dunlop India in support of the sale of the land to him.

3rd August 2007/by Tyrepress Editors

MRF Joins Rubber Group’s Panel of Associates

The International Rubber Study Group (IRSG) has released a statement outlining the addition of India’s largest tyremaker, MRF, to the Group’s Panel of Associates. The Wembley based IRSG, an intergovernmental organisation providing a forum for the discussion of issues affecting the supply and demand of both natural and synthetic rubber, stated it was “pleased to have MRF as one of its members, thereby expanding the good cooperation with the Indian rubber sector, one of the major growth areas in the world.”

The IRSG Panel of Associates includes a number of global tyre majors, including Bridgestone, Goodyear, Pirelli, Yokohama and Continental. MRF, however, is the first Indian tyremaker to add its name to the list. All companies or organisations participating in the rubber industry are eligible to join the Panel of Associates, and the IRSG believes members benefit from the interaction between industry and the Group’s Secretariat.

1st August 2007/by Tyrepress Editors

Official Ceremony Marks Opening of Yokohama India

International News

The Yokohama Rubber Co. took a further step into the Indian market on July 27 when it officially marked the opening of its new subsidiary, Yokohama India. Company, industry, governmental and media representatives assembled at a hotel in New Delhi commemorate the occasion. Yokohama Rubber board director and senior managing corporate officer Takashi Sugimoto and board director and corporate officer Tooru Kobayashi represented the parent company at the ceremony.

Prior to this year Yokohama Rubber marketed passenger car tyres in India through its Singapore based tyre distributor. The transition to an India based operation began with the founding of Yokohama India in April 2007, and from now onwards the company plans to transfer sales activities to the new subsidiary, from where it will implement its own independent sales strategy. The company reports that Yokohama India will kick things off with an emphasis on the high performance passenger car market, an area in which the company believes to be a particular area of strength. This initial activity will include the Indian launch of the company’s premium ADVAN brand and other high-performance tyres and an intense supporting advertising campaign through car magazines and other media. From here Yokohama India will broaden its focus to the wider market.

1st August 2007/by Tyrepress Editors

Pre-Tax Profit Skyrockets at JK Tyre

The un-audited financial results released by JK Tyre & Industries Ltd for the quarter ending June 30, 2007 – the third quarter of India’s financial year – reveal good news for shareholders and paint a picture of a company in a strong position.

Revenues of Rs 8,178 billion (£100 million) were recorded for the quarter and the company reported EBIDTA of Rs 725.3 million (£8.8 million), up from the Rs 444.9 million (£5.4 million) achieved last year. Pre-tax profit rose to Rs 312.3 million (£3.8 million), a huge jump from a year ago when profits before tax stood at Rs 56.1 million (£683,700). The earnings per share for the quarter stands at Rs 6.56 (£0.08).

31st July 2007/by Tyrepress Editors

Indian Tyremakers to Spend £670 million

According to India’s Economic Times, tyre companies in the subcontinent plant to invest around £670 million in their operations over the next two or three years. The financial daily reports that this sizable sum will be spent by a number of players including MRF, JK Tyre, Apollo, BKT, Ceat, Birla and Bridgestone. Birla alone is reportedly spending £120 million, while Ceat is said to be making investments worth £97 million and JK Tyre £45 million.

Such a large investment is expected to increase industry turnover from its current £2.3 billion up to £3.9 billion, and much of the increase may come from the production of TBR tyres. While radialisation in the passenger car sector has reached over 95 per cent in India, TBR market penetration remains a paltry 2 to 3 per cent.

30th July 2007/by Tyrepress Editors

Ceat shareholders Give OK to Demerger

Shareholder’s in India’s Ceat Ltd have approved the demerger of the company’s investment arm CHI Investment into a standalone entity. The demerger had previously been approved by the Bombay High Court.

Ceat said the demerger would enable it to optimise performance and enhance value for the shareholders by concentrating on its core business. Post demerger, the company’s shareholder would get 25 shares in CHI and 75 shares in Ceat for every 100 shares held on the date of recording.

30th July 2007/by Tyrepress Editors

An “Exciting Year”

The 34th Apollo Tyres Annual General Meeting, held in the Indian state of Kerala on July 26, was more than merely an occasion on which to report the company’s latest financial results. For chairman Onkar S Kanwar it was an opportunity to take stock of where the company has been and where it is headed. These thoughts were reflected in his address to company shareholders.

“The India we live in has changed dramatically over the last 34 years, he said in opening. “And especially so in the last ten. Today we stand at the threshold of great opportunity as a nation, for tomorrow will be India’s century.” He added that if India takes on the attitude of “being a winner”, as he believes Apollo has, the nation will continue to grow and “claim our rightful place in the pantheon of leading nations of the world.”

26th July 2007/by Tyrepress Editors

Apollo Reports Strong Q1 Financials

On July 25 the board of directors at Apollo Tyres reported the company’s unaudited results for the first quarter of the 2007-08 financial year, and also named August 27 as the date in which Rs 10 equity shares will be split into ten equity shares valued at Rs 1 each.

First quarter (April to June) net sales closed at Rs 11.5 billion (£138.6 million), an increase of 22 per cent on the previous year’s Rs 9.4 billion (£113.3 million). Net profit was recorded as Rs 546.4 million (£6.6 million), an impressive 369 per cent jump on the Rs 116.5 million (£1.4 million) obtained during the first quarter of 2006-07. Apollo attributes this significant profit growth to stabilising prices in major raw materials such as natural rubber, crude and steel, plus an improvement in key operating efficiencies, including wage cost, interest and depreciation.

The tyremaker further reported that all major product categories experienced substantial growth both in India and South Africa. The highest growth areas were 35 per cent for truck and bus radials in South Africa and 23 per cent for car radials in India.

26th July 2007/by Tyrepress Editors

JV Partner Sought for India’s TCI

The Indian government’s wholly owned and ailing tyremaker, Tyre Corporation of India (TCI) is looking for a joint venture partner to help revive its fortunes. India’s Economic Times newspaper has reported that the government plans to attract a partner that can provide both the latest global technology and pan-India product marketing support.

An official from India’s Ministry of Heavy Industries told the Economic Times: “The matter now lies with the Parliamentary Standing Committee on Industry for a final approval, after a bill (the Disinvestment of Ownership Bill, 2007), was introduced in parliament in May. As and when it is passed, we would move ahead with the revival of the sick unit, through the disinvestment route.”

20th July 2007/by Tyrepress Editors

Pirelli Committed to Emerging Markets

At a July 19 ceremony marking the manufacture of their millionth high performance tyre in Romania, Pirelli presented news of its current activities and development plans for the company’s tyre and other vehicle related products. Present for the occasion were, amongst others, Marco Tronchetti Provera, chairman of Pirelli & C. SpA, Francesco Gori, managing director of Pirelli Tyre, plus a number of local authorities.

Marco Tronchetti Provera disclosed to reporters that Pirelli intended to go “where the growth is” when investing in new tyremaking facilities. “We are looking with interest at India,” he said. “We are looking at Russia as an interesting market.” It is believed that Pirelli would prefer to establish itself in these markets from scratch without acquiring established domestic operations.

20th July 2007/by Tyrepress Editors

Conti Boosts Presence in Emerging Markets through Acquisition

Continental’s Automotive Systems Division is bolstering its brakes systems capabilities in both Europe and in emerging markets, particularly Asia, through the acquisition of drum brake manufacturer Automotive Products Italia S.r.l. from the Australian Pacifica Group Limited. Based in Cairo Montenotte, in the Italian province of Savona, Automotive Products Italia employs approximately 500 people and since its establishment in 1984 has grown into a business with annual sales (2006) of 79 million euros.

This acquisition is not the beginning of relations between Automotive Products Italia and Continental Automotive Systems – the two parties have been involved in a technical and marketing cooperative agreement for the past decade. Automotive Products Italia has grown to become Europe’s second largest producer of drum brakes; approximately 5.8 million drum and park brakes were manufactured at the company’s 17,000 square metre facility in Savona last year, and counted amongst the firm’s OEM customers were major manufacturers such as Fiat, Ford, Renault/Nissan, Toyota, Land Rover, Mazda and General Motors. Upon regulatory approval the company will be integrated into the Hydraulic Brake Systems business unit of Continental Automotive Systems.

19th July 2007/by Tyrepress Editors

JK Tyre Aiming to Increase Turnover by More than 50%

It is hoped that JK Tyre and Industry’s Rs 11 billion (£135 million) capital expenditure and capacity increase from 9 million to 12 million units will help towards the company achieving a turnover of Rs 50 billion (£610 million) within three years, claims chief financial officer A K Kinra. Mumbai based publication DNA has reported Kinra as stating “We are aiming to grow by 20 per cent annually over the next 3-4 years. We hope to be a Rs 5,000 crore (£610 million) company by 2010.” Currently JK Tyre has an annual turnover of Rs 30 billion (£366 million).

Kinra added that the current slowdown in India’s car industry was not of concern to JK Tyre as OE contracts only make up about 10 per cent of the tyremaker’s business, with the rest coming from the replacement and export markets. “The slowdown has only a marginal impact on us. In the aftermarket space, we see a robust demand,” he said.

13th July 2007/by Tyrepress Editors

Metro Tyres to Offer Share to Conti

India’s Metro Tyres is reportedly willing to offer technical collaboration partner Continental a minority stake in its business. According to an article published in the Indian financial daily Hindu Business Line, Metro Tyres group managing director Rummy Chhabra said that a share of the company could be offered to Continental when Metro’s planned IPO – from which the company hopes to raise about Rs 1 billion (£12 million) – takes place in 18 months’ time, or possibly even beforehand.

Metro plans to increase their presence in Europe and Continental’s assistance has been invaluable to this end. Mr Chhabra said Continental was willing to help Metro enter its home European market as both companies’ products complement each other. “While we address the budget segment, Continental plays in the premium end of the market. Hence our products do not overlap each other.” The Indian tyremaker has already opened an office and warehouse in Barcelona, from where it will market its Ortem brand tyres and tubes to European markets. Mr. Chhabra said the company expects European sales to contribute up to £10 million to its total revenue during the first year.

13th July 2007/by Tyrepress Editors

Former BKT CEO & Equity Firm Buy Alliance Tire

Former Balkrisha Tyres CEO Yogesh Mahansaria and global private equity company Warburg Pincus have jointly acquired Israel’s Alliance Tire Co. for approximately US$150 million. The new owners intend to establish a greenfield facility in India to complement the agricultural and OTR tyre specialist’s existing Israel based production, with the facility in India serving as a site for the low cost sourcing of products.

Joseph Anglister, president of Alliance Tire said “we welcome the new ownership. An investment by a leading international investor such as Warburg Pincus combined with Yogesh Mahansaria’s extensive experience in the off-highway tyre industry will provide an impetus to our long-term objective of growing Alliance’s product library, strengthening our relationship with existing customers and tapping new markets.”

12th July 2007/by Tyrepress Editors