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INVESTMENT INSIGHTS

Check Before You Invest : JK Tyre & Industries Ltd

BSE: 530007 NSE: JKTYRE ISIN: INE573A01042
  |   Sector:  Automobiles   |   Industry:  Tyres & Allied

Snapshot

Q.1 Which industry/sub-sector does JK Tyre & Industries Ltd belong to?
JK Tyre & Industries Ltd belongs to the Automobiles sector, operating specifically within the Tyres & Allied segment.
Q.2 Is JK Tyre & Industries Ltd a good quality company?
JK Tyre & Industries Ltd is a average quality company, based on a somewhat consistent multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is JK Tyre & Industries Ltd undervalued or overvalued?
JK Tyre & Industries Ltd appears Fair, as its key valuation ratios are in line with their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings 17.15 20.54
Price to Book 2.27 2.14
Price to Sales 0.88 0.75
EV to EBITDA 8.28 9.45
Q.4 Is JK Tyre & Industries Ltd a good buy now?
JK Tyre & Industries Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of JK Tyre & Industries Ltd?
JK Tyre & Industries Ltd revenue growth is -1.3% for FY-2025, which is below its 5-year CAGR of 10.8%, indicating slower growth.

Q.2 Gross Profit margin of JK Tyre & Industries Ltd?
JK Tyre & Industries Ltd Gross profit margin which is the profit after deduction of direct costs, is 7.9% for FY-2025, which is in line with its 5-year median of 7.9%, indicating stable margins.

Q.3 Operating Profit Margin of JK Tyre & Industries Ltd?
JK Tyre & Industries Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 9.91% for FY-2025, which is in line with its 5-year median of 9.91% indicating stable margins.

Q.4 Net Profit Margin of JK Tyre & Industries Ltd?
JK Tyre & Industries Ltd Net Profit Margin is 3.79% for FY-2025, is in line with its 5-year median of 3.79%, indicating stable margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 7.9 7.9
Operating Profit Margin (%) 9.91 9.91
Net Profit Margin (%) 3.79 3.79

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of JK Tyre & Industries Ltd?
JK Tyre & Industries Ltd Return on Asset is 3.94%, which is above its 5-year historical median of 3.48%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of JK Tyre & Industries Ltd?
JK Tyre & Industries Ltd Return on capital employed is 12.17% for FY-2025, which is in line with its 5-year historical median of 12.17%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 13.5%, indicating value preservation.

Q.7 Return on Equity (ROE) of JK Tyre & Industries Ltd?
JK Tyre & Industries Ltd Return on equity is 9.53% for FY-2025, which is in line with its 5-year historical median of 9.53%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of JK Tyre & Industries Ltd?
JK Tyre & Industries Ltd Cash conversion cycle is 81 days, above its 5-year historical median of 68 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 1.04 1.04
ROE (%) 9.53 9.53
ROCE (%) 12.17 12.17
Cash Conversion Cycle 81 days 68 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of JK Tyre & Industries Ltd?
JK Tyre & Industries Ltd Debt-to-Equity ratio is 0.63, which is above the industry average of 0.44, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of JK Tyre & Industries Ltd?
JK Tyre & Industries Ltd Debt to cash flow from operations is 6.56, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of JK Tyre & Industries Ltd?

Q.1 Promoter shareholding and pledge status of JK Tyre & Industries Ltd?
Promoters hold 51.72% of the JK Tyre & Industries Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does JK Tyre & Industries Ltd performance compare with that of its Peers?

Q.1 Revenue growth of JK Tyre & Industries Ltd vs industry peers?
JK Tyre & Industries Ltd revenue CAGR is 10.80%, compared to the industry median CAGR of 9.77%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) -1.3 9.8
Gross Profit Growth (%) -30 15.7
Operating Profit Growth (%) -26 9.3
Net Profit Growth (%) -34.9 10.8
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.04 1.13
ROE (%) 9.53 10.87
ROCE (%) 12.17 12.59
Cash Conversion Cycle (days) 81.03 60

Valuation & price assessment

Q.1 Stock return of JK Tyre & Industries Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 16.1% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR		 16.1% 24.1% 26.7% -5%
Q.2 Valuation ratios of JK Tyre & Industries Ltd vs historical?
The current P/E ratio of 17.15 is lower than its historical median of 20.54, indicating that the stock is trading below its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median		 5-year
Industry Median
Price to Earnings 17.15 20.54 30.55
Price to Book 2.27 2.14 2.17
Price to Sales 0.88 0.75 1.37
EV to EBITDA 8.28 9.45 11.27

Check more companies

1. Apollo Tyres
2. CEAT
3. JK Tyres & Inds.
4. TVS Srichakra
5. Goodyear India
6. Tolins Tyres
7. Dolfin Rubbers
8. Emerald Tyre Manufac
9. Viaz Tyres
10. Innovative Tyres

Check trending companies

1. Cochin Shipyard Ltd.
2. Blue Star Ltd.
3. Kirloskar Oil Engines Ltd.
4. Garden Reach Shipbuilders & Engineers Ltd.
5. International Gemological Institute Ltd.
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