BKT aiming for $2 billion in annual sales

BUHJ, India—Balkrishna Industries Ltd. (BKT) has vision for growth. A three-year, $2 billion vision.

And at the center of that growth is the company's flagship facility in Buhj, where the tire maker plans to expand off-highway tire capacity to 600,000 metric tons per year. In doing so, the Indian tire maker said, it looks to take a significant stride toward achieving $2 billion in sales annually, something it expects to achieve by 2026.

And it's fitting, the tire maker said in a statement, that the Buhj facility is at the heart of that growth plan.

"BKT's journey toward the future starts here. Or rather, we should say that it continues from here, because it is through the Bhuj site, which was inaugurated in 2015, that the Indian multinational has been able to map out its future years, thanks to uniquely solid income and infrastructure in the global off-highway tires sector," BKT said in Feb. 20 statement.

The Bhuj site originally sat on 123 hectares of land, representing a $500 million investment. At the time, the facility production stood at 92 metric tons per year. Last year, BKT said, the facility reached its highest levels of operations, turning out 436 metric tons of products.

Buhj also has seen several land expansions since its christening. The site reached 126 hectares in 2016, 137 in 2021 and 258 in 2022. By the end of this year, BKT expects to have 323 available hectares of land at the site, and it already has acquired 283.

"More space thus means more possibility to install new machines, to accommodate more test areas, to increase volumes and all that goes with it," BKT said.

And the upgrades, the tire maker, are needed given the growth it has seen in product demand. BKT has increased its business by 49 percent compared to pre-pandemic levels.

"People have asked me if all this was really necessary, so much in such a short time," Rajiv Poddar, joint managing director at BKT, said in a statement. "The goals we set ourselves when we decided to open the Bhuj site were proportional to the financial solidity of the time, but above all to a vision which is as great as it is concrete."

The Buhj site also is home to one of BKT's most significant investments, a carbon black facility that came onstream in 2017. Production of hard grade carbon black began at 65,000 metric tons per year, then grew to 110,000 metric tons by 2018, when soft carbon black was added.

By 2022, carbon black production—of both grades—had reached 138,000 metric tons per year. And that is set to grow further, BKT said, noting that by year-end it plans to produce 198,000 metric tons of carbon black annually. And, in doing so, the tire maker looks to add specialty carbon black production to its capabilities.

"Analyzing the market and anticipating it, with passion and foresight, is what we have done in all these years," Poddar said. "Growth has always been in step with demand, not without—let me say it—courage and creativity, but never without our objectives and investments having solid foundations.

"Global tire demand is growing and we see no signs of it slowing down over the next five years. This is a demand which started to rise during the 2020 pandemic, and which today is above pre-COVID levels. Will it be difficult? Will it be a challenge? Our vision is simple, which is why it is very concrete."