India's leading tyre manufacturer, JK Tyre has stated that they will be focusing on replacement market and exports as the domestic demand for tyre is under pressure.
Anshuman Singhania, MD, JK Tyre said, "We are directing our efforts in the replacement market, where we saw double digit growth in the month of June. We have also enhanced our focus in exports, as we are receiving promising responses from the United States and Latin America."
The statement came during a period in which smart revival in domestic and export demand are being witnessed. Singhania says, "we have recorded the highest ever sales numbers in the replacement market during the month of June and the trend is continuing in subsequent months till date."
He added that the sales figures have not been great due to the corona virus pandemic. The production of tyres have been hindered by the lockdowns that were implemented as a result of the pandemic crisis.
"Stabilization of production capacities remains a primary goal internally and we expect to optimize it in the foreseeable future," He added.
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JK Tyre has put a stop on their expansion scheme as a method to conserve funds or capital of the manufacturer.
Singhania stated, "We have for the time being deferred all our expansion plans including our foreign subsidiaries and will review after few quarters."
JK Tyre mentioned that they are operating their units at 70 percent capacity which seems to be a tactic to overcome the crisis period brought by the pandemic. The manufacturer added that this has led to the stabilisation of their production and supply chain.
Singhania added, "We have taken up various measures to reduce costs and overheads to maximize our profitability and have been working on conservation of cash by way of reduction in inventories and collection of receivables faster, to infuse liquidity."
The manufacturer also stated that they import some materials for production from China. However, the new import law has not affected them. They have "alternative sources to ensure continuity of operations."
