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Domestic tyre demand to grow in range of 7-9% between FY19-FY23: ICRA

12 Apr 2019 Evaluate

Rating agency ICRA is expecting that the domestic tyre demand will grow in the range of 7-9 per cent over the five year period between 2018-19 to 2022-23. The agency added that the market would also continue to witness investments over the period of next three years.

ICRA’s Vice President and Co-Head, Corporate Ratings K Srikumar said that with a stable demand outlook and strong credit profile, the domestic tyre makers will continue to invest in capacities.  He mentioned ‘based on announcements, the industry is likely to witness a capacity addition of over Rs 20,000 crore in the next three years’.

The revenue growth for tyre industry is pegged at 14-15 per cent for FY19, with operating margin and net margin of 14 per cent and 7 per cent, respectively, almost in line withFY18. For 2019-20 to 2021-22, revenue growth is projected at 9-10 per cent with operating and net margins at 14-15 per cent and 6-7 per cent, respectively.

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