He views Union Budget proposals as quite balanced and progressive in approach. Budget points to a blueprint for development in the coming years. With sight on manufacturing, the inclusive growth model is as promised by Indian Government. Gradual rise in GDP, especially by controlling physical deficit and CAD is expected.Dr Raghupati Singhania – Chairman and Managing Director, JK Tyre and Industries Ltd.
Union Budget 2015 outlines Indian government’s focus on infrastructure development, which in turn would encourage more foreign investment. The sentiment strengthens laying a foundation for long term growth. GST coming into effect by next year is determined. 8 pct growth looks a distant goal. Jaitley sent a clear message pertaining to government intent. Corporate Tax is proposed to be reduced to 25 pct over the next four years. This encourages growth and investment.
A pro infrastructure focus is a positive step forward with economy revival in mind. Capex of Rs 3,17,000 crore, in addition to outlay of Rs 14,000 crore in road sector is announced. Completion of one lakh km of roads currently under construction and sanctioning another lakh kms of construction helps boost tyre sector demand.
JK Tyre and Industries did expect correction in inverted duty structure in tyre sector but this was not considered. Import duty on rubber is one of the highest in India. With focus on manufacturing, JK Tyre and Industries is confident of correction in inverted duty structure. Tyres are raw material intensive, and natural rubber is in short supply in India. Imports are necessary to meet domestic demand. JK Tyre and Industries hope government reconsiders correction in inverted duty by reducing import duty on natural rubber, or by increasing duty on tyres.
Indian Government is focused towards education, and skills, introducing sops for students and establishing new hubs of higher education, which is important for overall progress. Union Budget 2015 is focused on development of rural India.
JK Tyre and Industries (JKTIL) reported consolidated net profit of Rs 92 crores for Q3 FY 2014-15, increase of 56 pct over PY. Consolidated turnover was announced at Rs 2001 crores. On a standalone basis, turnover of Rs. 1686 crores with Net Profit at Rs. 70 Crores was report. The later gain sat 107 pct over PY. Q3 performance improved significantly. Emphasis on Truck and Bus Radials has fuelled growth. New products and sales network expansion helped deeper market penetration.
Signs of truck and passenger car industry turnaround bodes well for the tyre industry. Government focus on manufacturing activity would further improve tyre demand. Infrastructure development including roads and mining sector boosts economic recovery. Chennai plant production capacity expansion at an outlay of Rs 1430 Crores in TBR and PCR categories is progressing well. JK Tornel, Mexico expansion of PCR capacity nears completion.