TVS Srichakra posts Rs.49 crore profit, fears Chinese imports

Chennai, Aug 14 (IANS) The devaluation of Chinese yuan poses a threat to two-wheeler tyre makers in India in the form of cheaper imports, a senior official of TVS Srichakra Ltd. said on Friday.

He said that already truck, bus and passenger car radial tyre makers were suffering due to cheap imports from China.

“The currency devaluation by China may now pose a risk to the two-wheeler tyre makers. There is a greater possibility of cheap imports of two wheeler tyres from China,” P. Vijayaraghavan, the TVS Srichakra Ltd. director told IANS.

According to him, the government has to act on the matter by imposing anti-dumping duty on Chinese tyres.

He said already the Indian truck, bus and passenger car radial makers were affected by imports from China.

Queried about the company’s plans to make tyres for Michelin India, he said, TVS Srichakra Ltd. would be rolling out 300,000 two-wheeler tyres per month as a contract manufacturer.

The new plant would come up at Madurai.

“As a contract manufacturer we will be making two-wheeler bias tyres for Michelin India. The tyres will be branded as Michelin and will be for Indian after market,” Vijayaraghavan said.

He, however, declined to share financial details – who would invest in the new plant and how much- between the two companies on the grounds of confidentiality agreement with Michelin India.

Meanwhile, TVS Srichakra closed the first quarter of current fiscal with a net profit of Rs.49 crore as against Rs.17 crore for the quarter ended June 30, 2014.

The company earned a total income of Rs.504 crore for April-June 2015 quarter as against Rs.451 crore earned during previous year in the corresponding period.

“We have done well to keep our top line growing, maintaining our share with the OEMs (original equipment manufacturers) as the largest supplier to the vehicle manufacturers,” Vijayaraghavan said.

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