| Date: |
10-06-2015 |
| Subject: |
Shares of tyre makers fall up to 24% since June 1 on Chinese import concerns |
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MUMBAI: Stocks of tyre manufacturers have been under selling pressure since June 1 on reports that import of Chinese tyres is eating into their share in the replacement market.
Ceat has plunged 24 per cent, Apollo Tyres is down 16 per cent, MRF is 10 per cent lower, and Dunlop has declined 9 per cent in the period.
Import of truck and bus radial tyres (TBR) has increased 60 per cent in 2014-15 over the previous year, much to the frustration of the domestic tyre industry. TBR imports rose to 7.8 lakh units from 4.9 lakh tyres in 2013-14. Roughly 25 per cent of domestic replacement demand for TBRs is being met by imported tyres, according to Automotive Tyre Manufacturers' Association (ATMA).
Import of TBRs from China has gone up three times from 1.9 lakh tyres in 2013-14 to 5.5 lakh tyres in 2014-15 and China has come to account for 70 per cent of total TBR import by volumes in India.
According to ATMA, huge surplus capacities in China are leading to tyres being dumped in India.
Industry experts are of the view that due to export subsidy, Chinese manufacturers are dumping tyres in replacement market. The domestic price in China is higher than export price.
Arnab Banerjee, Executive Director-Operations, Ceat, in an interview to ET Now said that the company has been able to expand margins in the previous quarters due to lower raw material costs. However, the company can't match Chinese pricing for tyres.
Source : economictimes.indiatimes.com
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