Balkrishna Industries inked three pacts with Pirelli to make 800,000 premium car tyres in India by 2030 and form a 50:50 joint venture.

The tyre maker signed a framework agreement, an offtake agreement and a service agreement with Italy’s Pirelli Tyre S.p.A. on 22 October. Financial figures were not made public.

Start with the near term. Under the offtake agreement, Balkrishna will make Pirelli-branded car tyres at its Bhuj plant in Gujarat, following Pirelli’s specifications.

Pirelli and its affiliates will buy them. Pricing is simple. It covers the actual cost of raw materials plus the cost of turning them into tyres.

Domestic supplies are paid for in rupees and exports in euros. Pirelli has committed to a minimum yearly purchase, and Balkrishna has committed matching capacity.

That arrangement runs until 31 December 2031. It ends sooner if the joint venture is up and running. The bigger plan comes later.

Both companies aim to form a 50:50 joint venture by 31 December 2030, subject to conditions, to run a new car tyre plant in India. The final joint venture agreement is yet to be signed.

The board will have four members, two from each side, with the chair rotating between them, and production capacity will be split equally.

Tyres from the plant would carry both the Pirelli and BKT brands.

Pirelli will also help test BKT-branded tyres for cars, SUVs and two-wheelers at its facilities outside India, and Balkrishna will pay for this in euros.

While the framework agreement lasts, neither company can team up with another party in India for a similar joint venture.

The company said no related party is involved, and Pirelli is not one. For context, Pirelli reported group revenue of about €6.8 billion for 2025.

Balkrishna reported 24% revenue growth to Rs 3,409 crore for the April to June quarter, and said in August that it plans to launch car tyres in November.

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