Balkrishna Industries - Destocking, Making The Ride Bumpy For Wholesales: ICICI Securities

ICICI Securities Report

Balkrishna Industries Ltd.'s July 2024 India off-highway tyres exports of, at $129 million, were down 6% YoY and lower than the trailing 12-month average monthly exports of $147 million, lowest in past 10 months.

Higher despatches compared to retails in the past few months, we believe, are resulting in weakness in despatches currently, amidst adverse macro situation.

Agri/OTR exports were down ~2%/11% YoY in July 2024. In Europe, the agri segment was up 9% YoY vs. a 7% deceleration in the OTR segment in July-24. U.S. agri/OTR segments slowed 22%/32%. For rest of world, exports decreased 7% YoY. Retain Add and a DCF-based unchanged target price of Rs 3,200, implying 26 times FY26E EPS.

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