Our new launch will be a 49" meant for the 100-110 T dumpers
We have very big plans for the OTR segment. As the payload and speed of the vehicles are increasing, the demand for big-sized radials is also on the rise; and we have taken the right step to meet the demand. We will be launching the 49" by the end of this year, and move on to 51" and, by 2016, I am sure we would be able to launch the 57", says Arvind Poddar, Vice Chairman and Managing Director, BKT. Excerpts from the interview.

How do you view the present scenario?
I think the market is improving a lot and the worst according to us, is over. There will be lots of new projects to be announced and the demand will grow.

The elections are round the corner. Don't you think that will be a deterrent?
I don't think so. Ultimately, there is huge deficit for infrastructure, and there will be new projects, very essential ones that will drive the growth. In industrial construction in India, I expect a growth around 10 to 12 per cent.

How do you address the issues of rising input costs?
As the price of the raw materials is going up, ultimately the product prices will also go up. Worldwide, it is the same thing that is happening. It depends on how we address the issue.

But how do you sustain the price levels? Does it not impact your performance?
It is not going to impact much because everyone needs good quality tyre. If they need a good quality tire they are bound to pay the actual price. We are not over-charging our customers not only to improve but also to maintain our profitability. Having said that, let me add, it's how we do the balancing act.

What's the export market like now?
Ninety per cent of the production goes to the international market. But yes, the last quarter was definitely a difficult one but now again we are seeing some positive signs, from Europe, America, from across the world.

Are there new products on the anvil?
Yes, we are the only one who manufactures all steel tyres in the OTR segment and in OTR, we currently have up to 31? size. Our new launch will be a 49?, specifically meant for the 100?110 T dumpers for mining. We have placed the order for the machinery, designing the mould, and are fully working on the same, and most probably, we will be able to roll out the tyre by the end of this year.

What about the new greenfield plant? Is it complete yet? What is the total investment?
Not yet. But we have already started the initial production, and the plant will be ready by the end of 2014. We have already pumped in an investment of Rs 2,000 crore.

What are your plans for the OTR segment?
We have very big plans for the OTR segment. There is huge potential and the market is definitely increasing. As the payload and speed of the vehicles are increasing, the demand for big-sized tyres is also on the rise, and these tyres have to be radials. So we will be launching the 49? by the end of this year, and move on to 51? and, by the 2016, I am sure we will be able to launch the 57".

Your focus is basically on the mining segment?
We have our focus not only on the mining segment but also on the industrial segment, for example, for radials for forklift trucks. We are going to make the fork-lift radials, because in Europe there is good demand for the fork lift radial; even in North America there is a good demand. Apart from that, we have our plans cut out for radials for agri-equipment, and general construction, for example radials for loaders.

What is the total demand supply scenario for the OTR?
Currently, the growth is not that visible. But there is still shortage for the big-sized radial tyres - 49", 51", and 57". There is good demand for these sizes in markets North America, Australia, Africa. So I think we have good market potential.

What about the Indian scenario of big-sized radials?
The potential and requirements for big-sized radials is there in India, but currently no one is manufacturing these, and naturally they have to import. I am very confident that once we launch our 49? that will further spur the demand for big-sized radials in India. And compared to the competition ours will be competitively priced with the same quality. And we are also very confident that we will be able to get a growth level of year on year of about 30 per cent, compared to the 18-20 per cent during the last fiscal.