List of Tyre Sector Stocks

Overview of the Tyre Industry in India (2024)

The Indian tyre industry is set for significant growth, with revenue expected to rise from $9 billion in 2022 to $22 billion by 2032. Approximately 60% of tyre demand comes from the replacement market, 30% from original equipment manufacturers (OEMs), and 10% from exports. Increased infrastructure investments and a return to office settings post-pandemic are driving replacement demand, particularly in the commercial vehicle (CV) sector.

Rising disposable incomes and a growing on-road stock of passenger vehicles (PVs) and two-wheelers are also boosting demand in the passenger segment. India is a leading global tyre manufacturer, producing a wide range of products, including advanced smart, noise-reduction, and electric vehicle tyres.

The top 5 tyre brands in India, including companies like MRF and Apollo Tyres, hold a strong reputation. In FY23, revenue for seven major listed companies—Balkrishna Industries, Ceat, Goodyear India, JK Tyre, Apollo Tyres, MRF, and TVS Srichakra—increased by 19%, reaching Rs 77,024.74 cr., up from Rs 64,716.12 cr. in FY22. With a focus on premium segments and continuous innovation, the tyre industry in India is well-positioned for future growth.

Major Tyre Companies in India

1. MRF Limited: Known as one of the best Indian tyre company in terms of revenue and brand equity, MRF offers an extensive range of commercial and performance tyres.
2. Balkrishna Industries: Specialising in off-road and industrial tyres, Balkrishna has significant international reach, marking it as one of the top tyre brands in India with a focus on exports.
3. Apollo Tyres: Recognised for its diversified portfolio and global presence, Apollo Tyres stands out among Indian tyre companies for its strength in international markets and premium offerings.
4. JK Tyre & Industries: Known for its innovations, particularly Smart Tyre technology, JK Tyre is a leading tyre manufacturer in India, catering to both domestic and export markets.
5. CEAT: CEAT is a prominent name in the tyre company share list, with strong e-commerce initiatives and a variety of performance tyres, enhancing its appeal as a top tyre brand in India.

Factors Affecting Tyre Stock Performance

• Raw Material Costs: Tyre production heavily relies on materials like rubber and carbon black. Stable crude oil prices and a decline in natural rubber costs recently improved profit margins for tyre company stocks.
• Technology and Product Lifecycle: Innovations such as puncture-proof and EV-compatible tyres have bolstered demand, influencing tyre shares price lists. Adopting these technologies is crucial for tyre manufacturers in India to remain competitive.
• Government Policies: The Indian government’s restrictions on tyre imports and incentives like the PLI scheme favour domestic production, boosting growth potential for tyre sector stocks.
• Consumer Trends: A growing preference for high-performance and sustainable tyres is influencing stock prices, making tyre companies in India that prioritise these attributes more attractive in the tyre stocks market.

How to Identify Tyre Stocks To Invest In

• Revenue Growth: A consistent upward trend in revenue signals strong demand for a company’s products and market expansion.
• Profit Margins: High and stable profit margins indicate a company’s efficiency in managing production and raw material costs. In the tyre industry, this often reflects effective cost control and pricing power, both essential for long-term profitability.
• Debt-to-Equity Ratios: This ratio reveals a company’s approach to financing growth. Lower debt levels generally reduce financial risk, while high leverage may indicate aggressive expansion and potential vulnerability to economic changes.
• Operational Efficiency: Tyre companies in India with resilient supply chains and technological advancements are often better positioned to handle market changes and maintain profitability in the face of raw material volatility or competition

How to Invest in Tyre Stocks

Investors can buy tyre company stocks via exchanges like the NSE. Analysing tyres stock price trends, consulting a tyre shares price list, and focusing on financial stability are effective strategies. Here are a few basic steps to follow:

• Open a Demat/Trading/Stockbroker Account: Start by opening a demat account with a trusted stockbroker to enable online trading and investing in tyre stocks.
• Conduct Thorough Research: Identify the top tyre stocks in India that align with your investment goals. Utilise tools like the Tickertape Stocks Screener to identify the tyres stock price and other metrics. The screener offers 200+ built-in filters, allowing you to choose parameters such as market capitalisation, financial performance, growth trends, and more.
• Place a ‘Buy’ Order: Once you’ve selected the best Indian tyre company that meets your criteria, execute a ‘Buy’ order through your trading account to initiate your investment.

Advantages of Investing in Tyre Stocks

As the tyre industry in India matures, the demand for premium and speciality tyres offers the potential for steady returns.

• Exposure to Automotive Growth: Tyre stocks offer indirect access to the automobile sector’s growth. As vehicle ownership rises in India, especially for personal and commercial uses, tyre demand naturally follows.
• Export Growth: Indian tyre companies are expanding internationally, reaching markets across the U.S., Europe, and beyond. Export growth diversifies revenue sources and buffers companies from domestic economic shifts.
• Niche Markets in Premium and EV Tyres: Increased demand for electric vehicle-compatible, high-performance, and eco-friendly tyres opens opportunities for companies focusing on specialised, high-margin segments. Check out our blog on EV stocks to learn more

Risks Associated with Tyre Stocks

• Raw Material Cost Volatility: Prices of key inputs like natural rubber and crude oil can fluctuate significantly, affecting production costs. Tire brands in India with high raw material dependency are especially vulnerable to this cost volatility.
• Intense Competition: The Indian tyre market is highly competitive, with both domestic and international players. Continuous R&D investment is essential to differentiate products, especially in premium and high-tech tyre segments.
• Economic Cycles and Demand Fluctuations: The tyre industry’s performance is closely tied to the economy. During downturns, vehicle sales of even the best tyre brand in India typically decrease, reducing tyre demand and impacting company revenues.

Who Should Invest in the Best Tyre Stocks in India NSE?

Tyre sector stocks are suited for investors looking for long-term growth aligned with the automotive and infrastructure sectors. The Indian tyre companies list includes firms with strong financial health and export capabilities, making them attractive to those with a moderate risk appetite.

Factors to Consider Before Investing in Tyre Stocks

• Market Position: Top tyre brands in India, like MRF and CEAT, hold a strong market presence supported by consumer trust and brand equity.
• Financial Health: Stable revenue growth, profit margins, and low debt levels are critical indicators of resilient tyre manufacturers in India.
• Export Reach: The best tyre brand in India, with a robust export strategy, may capitalise on global markets, diversifying their revenue sources.
• Innovation and R&D: Investing in eco-friendly, EV-compatible, and smart tyre technology enhances the appeal of tyre stocks for the future.

Conclusion

India’s tyre industry, driven by rising vehicle demand and strong export markets, offers promising opportunities for investors. With solid brand recognition, favourable economic conditions, and proactive government policies, tyre company stocks provide a pathway to participate in India’s manufacturing growth. The top tyre brands in India continue to innovate and adapt to global trends, making tyre stocks a valuable addition to a diversified investment portfolio.