6% – 8% growth expected for two wheeler tyres in India by 2019.
Indian credit ratings agency ICRA research estimates 6 percent-8 percent demand growth for two wheeler tyres over the next three years (period ending FY2019). Motorcycle and scooter tyre demand is estimated to grow by 6 percent and 11 percent during this period.
Apollo Tyres, Balkrishna Industries and Bridgestone India have announced their entry into the domestic two wheeler tyre segment in the last three quarters. JK Tyre and Industries too entered the segment with the acquisition of Kesoram Industries’ tyre unit in April 2016, while Metro Tyres Limited — an existing two wheeler tyre player — is foraying into the motorcycle radial segment. Also, Michelin India, which was earlier catering to the premium bike tyre segment, is now entering the mass two wheeler tyre market.
Two wheeler tyres represent nearly half the domestic tyre production in India, although given the significantly lower realization, in value terms, the segment accounts for only 13-15 percent of the industry. Performance of the two wheeler tyre segment has been strong in recent years; against the tyre industry volume CAGR of 7.5 percent during the period FY2014 to FY2016, the two wheeler tyre segment has grown at a faster rate of 13.1 percent, led by robust scooter volumes and despite the muted rural demand for motorcycles.