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Market dynamics of India’s tyre industry
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5 min read | Updated on June 06, 2025, 14:49 IST
SUMMARY
As India's auto industry matures, its ancillary sector is projected for steady long-term growth of ~7-9%, modestly exceeding overall GDP growth. However, the tyre industry presents significant potential for outperformance, fuelled by innovation and increasing penetration. From rugged off-road adventures to smooth city rides, tyres are key to mobility. Let’s hit the road and explore how technology, sustainability, and market dynamics are reshaping the future of Indian tyres.
The tyre industry is expected to grow at ~15% versus ~9% for the auto ancillary industry
It is projected to grow from $12.8 billion in 2024 to $29.1 billion by 2030. Driving this surge? More vehicles, better roads, and rising demand for high-performance tyres. As expectations rise, manufacturers are doubling down on innovation and efficiency to stay ahead.
Source-Wright
Segment-wise domestic market share
India’s tyre industry relies on its dominant vehicle segments, with two-wheelers and passenger vehicles driving demand. As urban mobility expands and personal transportation becomes more widespread, these segments continue to shape tyre consumption.
Source: IBEF; Note: Until September 2024
Year-wise progression of India’s tyre export performance
India’s tyre industry has been steadily making its mark in global markets. The chart below shows how exports have grown over the years, with a clear rise in recent times. Key markets driving this growth include the USA (19%), Germany (7%), Brazil (6%), the UK (4%), and France (4%).
Source- IBEF, The Economic Times, Manufacturing Today India
How natural rubber drives India’s tyre industry
India’s tyre industry thrives on its natural rubber production, making it a key player in the global market. As the third-largest producer and fourth-largest consumer, the country benefits from a steady supply of high-quality raw materials. Kerala, Tamil Nadu, and Karnataka significantly contribute to rubber cultivation, supporting tyre manufacturing.
Source-Infomerics Research
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The tyre industry in India consumes over 65% of the country’s natural rubber, totalling 13 lakh metric tonnes annually, while domestic production is only 8 lakh metric tonnes. This leads tyre companies to import nearly 40% of their rubber, making India the second-largest rubber importer globally.
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With the booming automotive market, tyre demand has surged, prompting the government and manufacturers to boost domestic rubber production for self-sufficiency. The INROAD project from the Ministry of Commerce and Industry aims to expand rubber cultivation by two lakh hectares in Northeast India, beyond the traditional hub of Kerala.
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Tyre manufacturers like JK Tyre have pledged ₹1,100 crore over five years to enhance rubber production across eight states. So far, 70,000 hectares have been cultivated, with three crore trees planted, benefiting 80,000 farmers in 93 districts. The project is expected to support 2.5 lakh farmers upon completion.
The rising demand for EV-specific tyres in India
As EV adoption rises across India, the demand for EV-specific tyres is also increasing. With EV sales witnessing significant growth, tyre manufacturers are focusing on specialised designs that enhance efficiency, range, and durability.
Indian companies are investing in new technologies to develop tyres with lower rolling resistance, higher load-bearing capacity, and better noise reduction. As a result, leading domestic tyre brands are expanding their product lines to cater to the evolving needs of EV owners.
Source-MarkNtel Advisors
Leading Indian EV tyre manufacturers
| Company | Model | Key features |
|---|---|---|
| Apollo | Amperion (passenger EVs), WAV (two-wheelers) | Features AQuT for noise reduction and Battery Energy Saver Technology (BEST) for improved battery efficiency. |
| CEAT | EnergyDrive (cars), EnergyRide (two-wheelers), WinEnergyX3R (trucks) | Speciality tyres designed for EV applications with enhanced durability. |
| TVS Srichakra | E Torq (two-wheelers) | Focuses on low rolling resistance for better battery efficiency and performance. |
Source: Comapny reports, news articles
Listed tyre companies in India
The Indian tyre industry is booming, fueled by an expanding auto sector. Leading companies like MRF, Apollo Tyres, CEAT, JK Tyre & Industries, and Balkrishna Industries dominate the market. With a mix of global expansion and domestic production, these brands are driving India's tyre revolution.
Below is a table highlighting some of the leading companies in this industry :
| Company Name | Market Cap (₹ Cr) | P/E Ratio | ROE (%) | 5y Compounded Profit Growth (%) | 5y stock price CAGR (%) |
|---|---|---|---|---|---|
| Balkrishna Industries | 51,844 | 29.2 | 17.6 % | 14.0% | 23.0% |
| MRF | 57,340 | 32.7 | 12.6 % | 12.0% | 17.0% |
| Apollo | 30,059 | 22.3 | 13.2 % | 16.0% | 36.0% |
| CEAT | 13,446 | 27.3 | 11.7 % | 15.0% | 31.0% |
| JK Tyre & Industries | 8,781 | 14.6 | 20.6 % | 33.0% | 43.0% |
| TVS Srichakra | 2,238 | 53.2 | 10.6 % | 2.0% | 22.0% |
| Average | 27,284.6 | 29.9 | 14.4% | 15.3% | 28.1% |
Source- Screener; Data as of April 30th, 2025
Final thoughts
As mobility shifts towards better efficiency and durability, manufacturers are developing smarter tyres with improved performance. Sustainability is also a key focus, with companies integrating eco-friendly materials and energy-efficient production. The industry is steadily growing with domestic players expanding globally and investing in advanced materials.
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