Shares of JK Tyre and Industries fell more than 6% in early trading on May 18 as investors cashed in some profits after strong quarterly earnings. This comes against the backdrop of a strong run on the counter in recent months.
The stock has rallied more than 23% over the past three months, giving investors room to take some profits. Reflecting investor confidence in the company’s prospects, the share price has risen from Rs 50 to Rs 190 over the past three years.
Shares of JK Tyre were down 4.86% at Rs 189.90 at 10:54 am on the National Stock Exchange.
The company’s consolidated net profit more than tripled year-on-year to Rs 112 crore in the fourth quarter, buoyed by strong domestic demand for passenger cars and commercial vehicle radial tyres.
Total revenue rose to Rs 3,645 crore from Rs 3,320 crore a year earlier. EBITDA margin also widened to 10.4% in the fourth quarter from 6.9% a year earlier.
While ICICI Securities expressed concern that the company’s sequential gross margin expansion lagged behind its peers, most brokerages remained optimistic about the tire maker’s long-term prospects.