List of Best Tyre Stocks In India 2024

In India, the automobile sector has seen impressive growth, resulting in high demand for top-quality tyres. The Indian Tyre market is projected to reach 253.9 Million Units by 2032, indicating a CAGR of 2.9% from 2023 to 2032. Investors who want to diversify their portfolios with stocks from this sector need to gain knowledge about the top tyre stocks in India. With the help of this blog, we will understand everything about the best tyre stocks in India, their advantages, disadvantages, and a lot more. 
 

Best Tyre Stocks in India in 2024 

Here is the Best tyre stocks list for your reference:

Company Name

Industry

CMP

Market Cap

P/E

52 Week High

52 Week Low

MRF LtdTyres₹ 1,26,561₹ 53,662 Cr25.46151,44599,000
Apollo TyresTyres₹ 516₹ 32,803 Cr.19.15557.90365.00
Balkrishna IndustriesTyres₹ 3,168₹ 61,234 Cr.41.843,363.95 2,193.80
JK Tyre & IndustriesTyres₹ 396₹ 10,316 Cr.13.31553.95192.55
CEAT LtdTyres₹ 2,453₹ 9,922 Cr.15.592,998.452,003.05

Disclaimer— All the information mentioned above is accurate as of 26th June 2024. However, it is important to conduct research before making any investment decisions in these stocks.
 

 

Overview of Best Tyre Stocks in India 

Here is an overview of the best tyre stocks in India: 

MRF Ltd 

MRF Ltd was incorporated in the year 1960 and is India's largest tyre manufacturer and ranked among the Top 20 Global Manufacturers. It is also India's largest Original Equipment Manufacturer (OEM) tyre supplier with an expansive tyre range from two-wheelers to fighter aircraft.

  • The stock is trading at 3.33 times its book value
  • The company has a low return on equity of 7.61% over the last 3 years.
  • The company has reported net profit after tax of Rs 396.11 Crore in the latest quarter.

Apollo Tyres

Apollo was founded in 1972 and produces tubes, radial and automated bias tyres. Its plants are located in Chennai, Pune, Vadodara, and Kochi. Prominent tyre brands from India's T&B, light truck, passenger car and farm vehicle segments are included in the product profile. These brands serve both OEMs and the replacement market.

  • The company has been maintaining a healthy dividend payout of 26.8% 
  • The company has delivered sales growth of 7.66% over the past five years.
  • The company has a return on equity of 9.35% over the last 3 years.
  • The company reported a net profit after tax of Rs 353.97 Crore in the latest quarter. 

Balkrishna Industries

In 1987, Balkrishna Industries Limited (BKT) began selling off-highway tyres. BKT has effectively concentrated on niche markets for more than 30 years, including earthmoving, port and mining, ATV, gardening, and the construction, industrial, and agricultural sectors. 

  • The company has been maintaining a healthy dividend payout of 29.3% 
  • The company has reported a net profit after tax of Rs 486.75 Crore in the latest quarter. 

JK Tyre & Industries

JK Tyre & Industries Ltd. is a small-cap company in the tyre industry that was founded in 1951.  It is one of the leading tyre manufacturers in India and among the top 25 manufacturers in the world with a wide range of products catering to diverse business segments that include Truck/Bus, LCV (Light commercial vehicles), Passenger Cars, MUV (Multi utility vehicles) and Tractors. 

  • The company has delivered good profit growth of 32.9% CAGR over the last 5 years
  • The company has been maintaining a healthy dividend payout of 17.1%
  • The company has a low return on equity of 13.2% over the last 3 years. 
  • The Company has reported net profit after tax of Rs 174.90 Crore in the latest quarter. 

CEAT Ltd 

One of India's biggest tyre producers and one with the fastest pace of growth is CEAT, which was founded in 1958. In 1982, CEAT was integrated into the RPG Group. 

  • The company has reduced debt.
  • The company has been maintaining a healthy dividend payout of 20.7%
  • The company’s return on equity of 9.33% over the last 3 years. 
  • The company has reported a net profit after tax of Rs 92.87 Crore in the latest quarter. 
     

Factors to Consider Before Investing in Tyre Stocks in India

Here are the factors you need to consider before investing in Tyre sector stocks in India:

  • Financial performance: To determine the company's stability and growth potential, examine revenue growth, profit margins, and debt levels. To determine its growth potential you can compare the company's performance to similar companies in the same industry. 
  • Market demand: With the expansion of the automotive industry there is an increase in demand for tyres. Increasing tyre production, which in turn has increased tyre waste. Tire recycling has become increasingly important to reduce this waste.
  • Product range: There is a better chance for companies to capture market share if they offer tyres for a variety of vehicles and purposes. It's important to consider the diversity of the company's portfolio. 
  • Management expertise: Identify the management team's experience and performance history, since successful leadership is essential for long-term success.
  • Regulatory environment: Stay updated about the government rules and policies that may impact the tyre and automotive sectors. These rules and regulations might have an impact on market opportunities and operating expenses.
     

Why Should You Invest in Tyre Stocks?

Investing in tyre stocks can be a smart choice as the tyre stocks in India have a bright future thanks to the growing demand for vehicles and infrastructure development. However, before making any investment decision, it’s important to conduct thorough research and take into account different factors such as market trends, company financials, and the overall economic environment. Additionally, investors should look into the company's competitive advantages, such as its brand image, research and development capabilities, and the quality of its products. 
 

Advantages & Disadvantages of Investing in the Tyre Stocks in India

Here are the advantages and disadvantages of the best tyre stocks in India

Advantages 

Disadvantages 

Strong demand due to increasing vehicle sales

Highly competitive market

Growth opportunities from infrastructure development

Vulnerability to raw material price fluctuations

Diversification within the automotive sector

Dependence on the automotive industry's performance

Potential for innovation and technological advancements

Regulatory risks

 

Conclusion
To sum up, investing in the best tyre stocks in India can have significant growth prospects as the automotive industry is growing.  A thorough assessment of the companies' market capitalisation, financial stability, and strategic initiatives must be conducted. By considering the factors mentioned above, you can make informed decisions and benefit from the tyre industry's growth. To start your investment journey in the top tyre stocks in India you need to download a stock market app so you can easily browse through the tyre stocks list. 

FAQs on Best Tyre Stocks in India

MRF Tyres is one of the oldest tyre companies in India, it was established in 1946, a year before the country gained its independence.

Yes, with the growing automotive sector and infrastructure development, the tyre industry has promising growth prospects. However, thorough research and market analysis are important.

The factors that should be considered before investing in tyre stocks are market trends, company financials, management team, product diversification, and the regulatory environment.

The risks associated with investing in tyre stocks are market competition, raw material price fluctuations, dependence on the automotive industry's performance, and regulatory changes.

To stay updated on the performance of tyre stocks you need to regularly monitor financial news, company reports, and industry analyses.