JK Tyre & Industries announced to the stock exchanges on November 1 that the Board of Directors has sanctioned an expansion plan aimed at enhancing the company's tyre manufacturing capacity.
The company said as of July 13 the annual capacity for tyre production at JK Tyre & Industries stands at 155.11 lakh tyres, with a utilization rate of 95 percent. It further stated that it has put forth plans to amplify this capacity by 19.45 percent, aiming to reach an enhanced capacity by October 2025.
Talking about the financial aspect and investment, JK Tyre said an investment of Rs 1,025 crore is required to achieve this substantial expansion.
The company also said it intends to finance this project through a combination of equity, internal accruals, and debt.
On the rationale for expansion, the company said the driving force behind this initiative is the robust growth observed in the Indian auto industry. With an optimistic outlook for continued growth in the sector, JK Tyre & Industries sees a significant opportunity to further solidify its market presence in the automotive tyre industry.
"The Indian auto industry is witnessing good growth, which is expected to continue for some time. Hence an opportunity to increase the company's market presence further in the automotive tyre market," the company stated in the stock exchange filing.
On November 1, JK Tyre and Industries' shares settled at Rs 309.30 apiece on the BSE, which was up Rs 5.05 or 1.66 percent higher than the previous day's close.
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