JK Tyre set to gear up exports
Company plans to start selling 2-wheeler tyres before end of this year.

JK TYRE, the largest tyre exporter from India alongwith Vikrant , has drawn up a strategic business plan to increase the exports from the present Rs. 200 crore to Rs. 450 crore in 2006.The group accounts for over 26 per cent of tyre export out of India in FOB value terms and over 27 per cent share of export in terms of quantity of truck and bus tyres.

As a first step, it has now activated the operations of JK Asia-Pacific Ltd., a wholly-owned subsidiary floated in Hong Kong some time back. "The subsidiary, established specifically to give a thrust on exports into South Asia and Australia, will also source raw materials and chemicals from that part of the world," Mr. Amit Chaturvedi, President - JK Tyre told ET. The company has opened an office in Singapore recently and is looking at opportunities in other parts of the world also.

Even while the strategic business plan of the company to boost exports is being finalised, Mr. Chaturvedi said, the company has identified the African and the Latin American markets as the other thrust areas.Its tyre export basket largely comprises truck bias, truck radials and LCV bias."We are not looking at car radial exports at least for some time to come. While the existing domestic market is large enough to serve, the replacement market too is opening up in a big way," he said. Of the company's total four million tyre capacity, about 1.2 million units has been earmarked for passenger car radials.

Tapping the huge market for two-wheeler tyres in the country is another priority area for the company."This is the segment, when the brand enters the customer's mind. So from a branding point of view too, it is important for us to have a presence in this segment," Mr. Chaturvedi observed. The company plans to start selling 2-wheeler tyres before the end of 2001.Meanwhile, the company is trying to further improve its operational efficiency in order to withstand the increased pressure on profit margins due to competition.

While there is a six per cent increase in costs, the intense competition in the truck tyre segment has resulted in a 2.5-3 per cent price drop."Our plans are cost effective. But, there is always scope to cut down the costs including manpower rationalisation," he said. Supply chain management is an important focus area for the company so as to bring down inventory levels and it has placed its trust on IT.It has just finished the phase I of its e-commerce plan by primarily connecting its all offices, plants and stocking points through V-Sats at a cost of Rs. 80 lakh.