INDIAN TYRE INDUSTRY FY2018 margins to crimp on high cost inventory

Transcription

1 ICRA RESEARCH SERVICES Contacts: Subrata Ray Pavethra Ponniah K Srikumar INDIAN TYRE INDUSTRY FY2018 margins to crimp on high cost inventory ICRA LIMITED August 2017

2 Contents Summary Tyre demand growth pegged at 7-8% for FY2018 and FY FY2018 Margins to fall due to high cost inventory Indian automotive industry - Demand trends and outlook Strong demand outlook for FY M&HCV demand disappointed in FY Growth expectations for FY2018 positive Indian tyre industry - Demand trends and outlook Volume demand grew by 9-9.5% during FY Tonnage demand grew by 5% in FY Updates on tyre imports and exports Tyre exports (volumes) up by 28% in FY2017; weak realisations drag value growth to 10% Tyre exports are projected to grow at 6%-8% over the next three years Demonetisation impacts tyre imports in FY2017; T&B imports still grew by 9% Updates on supply additions Capacity additions: Sizable capacities to be commissioned over the next two years Update on raw material price movement NR prices falls in Q1FY2018; output likely to remain strong Prices of crude derivatives Industry financials and ICRA ratings on the sector FY2017: Muted revenue growth despite stronger than expected volume traction FY2018: Revenue growth expected to pick up Industry-wide comparison of players profile ICRA credit ratings on tyre players Tyre industry median financials Company Section Apollo Tyres Limited Balkrishna Industries Limited Ceat Limited Goodyear India Limited JK Tyre And Industries Limited MRF Limited TVS Srichakra Limited ICRA LIMITED Page 2

3 List of Tables and Charts Automotive industry demand Exhibit 1: Automotive Industry Production Growth (Volumes) Exhibit 2: Automotive Industry Segment Wise Production Growth Exhibit 3: M&HCV production trend Exhibit 4: LCV production trend Exhibit 5: Tractors production trend Exhibit 6: Two-wheeler production trend Exhibit 7: PV production trend Tyre industry demand Exhibit 8: Tyre Industry Volume Demand Growth Exhibit 9: Tyre Industry Segment Wise Demand Growth Exhibit 10: Tyre Industry Tonnage Demand Growth Exhibit 11: Tyre Industry OEM and Replacement demand (volume) Exhibit 12: Tyre Industry demand estimates Tyre Exports Exhibit 13: Trends in tyre exports from India (values) Exhibit 14: Tyre exports: Composition Exhibit 15: Growth in segment wise tyre exports Exhibit 16: Country wise tyre exports: Top 10 Exhibit 17: Exports to USA - Segment mix (values) and growth Exhibit 18: Exports to Germany - Segment mix (values) and growth Exhibit 19: Exports to UAE- Segment mix (values) and growth Tyre Imports Exhibit 20: Historical trends: Tyre imports (value) Exhibit 21: Tyre Imports : Composition Exhibit 22: Growth in segment wise tyre imports Exhibit 23: Country wise tyre imports: Top 10 Exhibit 24: T&B tyre imports and share of demand Exhibit 25: PV tyre imports and share of demand Exhibit 26: 2w tyre imports and share of demand Exhibit 27: Segment-wise imports from key countries Capacities and Supply Exhibit 28: Capacity, production and utilization in the Indian Tyre industry Exhibit 29: Planned quarterly capacity additions (value and volume) Exhibit 30: Planned capacity additions during FY18 onwards Input Costs Exhibit 31: Trends in NR price movements (annual) Exhibit 32: Trends in domestic and global NR price movements (monthly) Exhibit 33: Trends in NR Supply gap and net imports in India Exhibit 34: Price trends of Crude oil and rubber Exhibit 36: Synthetic rubber - Production, consumption and imports Exhibit 35: Price trends of Carbon black and Caprolactum Industry Financials Exhibit 37: Quarter-wise revenue and revenue growth Exhibit 38: Quarter-wise comparison of NR prices and Operating margins Exhibit 39: ICRA RM price index Outlook Exhibit 40: Trends in Revenues and growth Exhibit 41: Operating and net margins estimates Exhibit 42: Coverage indicators Exhibit 43: Industry wide capex estimates Exhibit 44: Debt metrics Industry wide peer comparison Exhibit 45: Operational and financial comparison across players ICRA ratings in the industry Exhibit 46: ICRA s Ratings in the Tyre industry Industry median Exhibit 47: Profitability ratios Exhibit 48: Capitalisation ratios Exhibit 49: Liquidity ratios Exhibit 50: Coverage ratios ICRA LIMITED Page 3

4 Please contact ICRA to get a copy of the full report Business Contacts Mr. L. Shivakumar shivakumar@icraindia.com Tel: / Mr. Jayanta Chatterjee jayantac@icraindia.com Tel: / Media and Public Relations Ms. Naznin Prodhani naznin.prodhani@icraindia.com Tel: Ms. Malika Munjal malika.munjal@icraindia.com Tel: ICRA LIMITED Page 4

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