Stock Of The Day: JK Tyre Surges After Analysts Identify Tailwinds

Shares of JK Tyre & Industries Ltd. surged over 7% on Friday after Emkay Global pointed out multiple tailwinds for the company. The brokerage maintains a 'buy' rating with a target price of Rs 700 per share, implying a potential upside of 77% from the previous close.

• Resistance Level: Rs 427 (one-month high)

• Support Level: Rs 390 (five-day low)

JK Tyre's stock rose as much as 7.4% during the day to Rs 422.95 apiece on the NSE. It was trading 6.58% higher at Rs 419.70 per share, compared to the 0.38% advance in the benchmark Nifty at 11:26 a.m.

Emkay conducted extensive channel interactions, pointing to multiple tailwinds for the company. The three key takeaways were:

• Trucking industry fundamentals and sentiments are healthy amid high utilisation levels and stable freight rates.

• Indian tyre companies continue to close the gap with multinational corporations across parameters like quality, performance and positioning.

• Improving demand and premiumisation have enabled players, including JK Tyres, to offset rising raw-material and EPR-related costs via price hikes

Emkay also forecasted further price hikes during the year in case costs of raw materials spike. It expects the commercial vehicle industry to enter an upcycle from financial year 2026, which contributes to 54% of the total revenues for JK Tyre.

Various fleet operators point to continuing healthy sentiment in the trucking industry, backed by high utilisation levels over 80–90% and stable freight rates. Fleet operators have logged in higher profit over the last few years, driven by more freight traffic and strong economic activity, which is also reflected in E-way bills, GST and FASTag collections, according to Emkay.

Three out of the five analysts tracking JK Tyre have a 'buy' rating on the stock, while two recommend 'hold, according to Bloomberg data. The average of 12-month analyst price targets implies a potential upside of 33%.