Balkrishna expects threefold gains from its tie-up with Pirelli

what happened

Balkrishna Industries (BKT) of India expects several benefits from its partnership with Italy's Pirelli, the world's fifth-largest tyre maker: a stronger global brand, access to European testing infrastructure and a steady income from production. Joint managing director Rajiv Poddar told Mint that the deal reflects the company's European presence and its manufacturing know-how.

Under an initial supply deal, BKT's Bhuj plant will make 800,000 tyres a year by 2030, and Pirelli will sell them under its own brand. The companies may later set up a 50/50 joint venture for premium car tyres if certain requirements are met. Under a separate services agreement, BKT pays to use Pirelli's simulation and proving-ground facilities, and the two keep their technologies separate.

BKT targets revenue of Rs 23,000 crore by FY30, with road-vehicle tyres making up 20%. Exports fell to 64% of sales in FY26 from 82% in FY22.

why it matters

For investors, the move signals a shift from off-highway tyres into cars and trucks, a segment where Motilal Oswal analysts warn that margins and returns could be diluted over the long run. Lower reliance on exports also reduces exposure to global off-highway demand.

market impact

Shares of BKT: the new Pirelli contract adds production volume and a partner for entering car tyres.

• ▲BKT shares pressure up — a new offtake contract from Pirelli adds manufacturing volume

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