Tyre industry seen growing at 7-8 pc in FY 26

 

The domestic tyre industry is expected to witness revenue growth of 7-8% this fiscal year, driven by replacement demand that accounts for half of annual sales, according to a report by Crisil Ratings. The segment is expected to post growth even as offtake by original equipment manufacturers (OEMs) is likely to be subdued, the report stated. It also noted that the rising premiumisation is expected to give a slight leg-up to realisations. However, escalating trade tensions and the risk of dumping by Chinese producers diverting inventories because of US tariffs could pose challenges, the report stated. Operating profitability is likely to remain steady at 13-13.5%, supported by stable input costs and healthy capacity utilisation, it said. This, along with strong accruals, lean balance sheets and calibrated capital spending, should help sustain the sector’s stable credit outlook, as per a report.

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