In the second half of the last fiscal year, the company utilized 95% of its production facility capacity.

JK Tyre Industries is working on removing operational bottlenecks, increasing production capacity to meet expected demand after the second wave of the epidemic and reducing long-term debt (expected to increase by one-third or Rs. 1.5 trillion in the) next three years.

The country’s third-largest tire maker said its business has recovered significantly since the easing of the embargo in the last fiscal year, and on 12 New capacity will not be considered for a month. Instead, the company will utilize its existing assets to meet demand.

Chief Financial Officer (CFO) Sanjeev Aggarwal told The Economic Times that the company reduced its net debt by Rs 9.3 billion in the last fiscal. Its net debt on books now stands at Rs 45,000 crore.

Once we further consolidate our position next year, we will be in a better position (given the new capacity expansion),” Aggarwal said.

JK Tires plans to invest Rs 100 invest Rs 100 crore in the next two years on maintenance costs and another Rs 200 crore on removing operational bottlenecks. The company says this will help increase its existing capacity by 10%.

In the second half of the last fiscal, the company utilized 95% of its manufacturing plant capacity. The annual production capacity is 32 million tires.

About two years ago, JK Tire initiated a project to expand its truck and bus lunchline production capacity. “But we were not sure about the demand due to changes in axle load standards and the epidemic. Now this (demand) is taking shape. We are watching the market carefully and taking a decision (to invest in new capacity) ‘.

In the short term, the company is confident of a strong rebound in sales in the domestic car market as Covid-19 sees fewer new cases driven by pent-up demand and traction in rural centers.

Ans GM human Singhania said signs of a normal monsoon this year bode well for demand.

p Singhania told The Economist, “Therefore, I think there will be a revival in rural demand and there will be a lot of pent-up demand. Moreover, focusing on saving cash and taking various measures to reduce costs and improve profitability, rural demand will increase.” . He told The Times:

Commercial vehicle sales at 33,3544 Vehicles are an indicator of economic activity, and Singhania said strong double-digit growth is expected in the coming months as local blockades are eased.

“We believe that commercial vehicle sales will grow significantly due to increased industrial activity, government infrastructure spending and a low base from the previous fiscal year.” He added that rapid vaccination will be a key factor in protecting the economy from the impact. A third wave of pandemic is likely to happen.

However, despite the expected recovery on the demand side, further rise in commodity prices could pose a challenge. Agarwal said the company plans to offset rising investment costs by expanding sales, improving operational efficiencies, securing unutilized production capacity and controlling costs. “Prices can also go up if necessary,” he said.