Synopsis: Balkrishna Industries Limited (BKT) has completed its Rs 800 crore carbon black expansion project along with its Rs 125 crore power plant expansion, taking the company’s carbon black capacity to 3,60,000 MTPA and captive power generation capacity to 64 MW.
Both projects have been funded entirely through internal accruals and form a key part of BKT’s long-term Vision 2030 growth strategy. Before the expansion, the existing facility was operating at 91% capacity utilisation, which indicates strong demand for the product.
Balkrishna Industries Limited is currently trading at Rs 2,198. The stock opened at Rs 2,200, reached a day high of Rs 2,205, and has so far recorded a day’s low of Rs 2,142.6. The current market capitalisation of the company is Rs 42,449 crore and is trading at a p/e ratio of 34.2, higher to the industry peer median of 23.04.
Carbon black is one of the major raw materials used in the manufacture of tyres, and captive power plants generate electricity for the operations of the factory. BKT will boost manufacturing efficiency and decrease dependence on outside suppliers by simultaneously increasing the two plants, which also means it will produce more of its own raw material and power.
The company has enhanced its Carbon Black capacity from 2,65,000 MTPA to 3,60,000 MTPA by adding 95,000 MTPA capacity at an investment of Rs 800 crore. It has also expanded its captive power plant from 40 MW to 64 MW, adding 24 MW at an investment of Rs 125 crore. The power plant was already running at about 80 percent capacity utilisation even before the expansion.
The expansion will increase BKT’s backward integration, allowing the company to produce more key inputs internally and generate more power for its plants. The projects also have a common infrastructure, which improves capital efficiency. The plant will also utilise the heat and gases generated in the carbon black production process to provide power to the expanded power plant, which will help reduce production costs, increase energy efficiency and contribute to its Vision 2030 growth strategy.
Financials
Balkrishna Industries Limited reported revenue from operations of Rs 2,933 crore in Q4 FY26, compared to Rs 2,737 crore in Q3 FY26 and Rs 2,752 crore in Q4 FY25. Revenue increased by 7.16 percent quarter-on-quarter along with an increase of 6.53 percent year-on-year.
The company reported a net profit of Rs 299 crore in Q4 FY26 lower compared to Rs 382 crore in the previous quarter, registering a sharp decline of 21.72 percent. However, on a year-on-year basis, net profit declined 18.97 percent from Rs 369 crore reported in Q4 FY25. Earnings per share (EPS) decreased significantly to Rs 15.49 from Rs 19.77 in the previous quarter, although it remained lower than Rs 19.06 recorded in Q4 FY25.
In terms of return ratios, the company reported a ROCE of 12.4 percent and ROE of 11.6 percent, reflecting relatively modest returns on capital employed and shareholders’ equity. The debt-to-equity ratio stood at 0.38x, indicating a moderate level of leverage on the company’s balance sheet.
The company has strengthened its manufacturing ecosystem, improved backward integration and created additional capacity to support future demand growth by increasing Carbon Black capacity and strengthening captive power generation.
Balkrishna Industries Limited (BKT) is a global leader in manufacturing off-highway tyres and caters to the agriculture, construction, mining, industrial, earthmoving and port segments. The company has built a strong global footprint in the speciality tyre market with its products exported to over 160 countries.
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