Shares of tyre makers advanced on Wednesday after the government has imposed anti-dumping duty on import of certain type of radial tyres used in buses and trucks.
Shares of tyre makers advanced on Wednesday after the government has imposed anti-dumping duty on import of certain type of radial tyres used in buses and trucks. The move is done in order to protect domestic manufacturers from below-cost shipments from China for five years. The stocks of MRF, Ceat, JK Tyre and Industries, Apollo Tyres, TVS Srichakra, and Goodyear rose up to 11% on BSE. The anti-dumping duty has been imposed in the range of USD 245.35 – 452.33 per tonne, said a notification issued by the Central Board Excise and Customs (CBEC).
Shares of MRF gained 2.14% to the day’s high of Rs 65,579.2, Ceat rose 2.42% to the day’s high of Rs 1,822.7, JK Tyre and Industries added 11.71% to the day’s high of Rs 165, Apollo Tyres advanced 3.92% to the day’s high of Rs 268.75, and TVS Srichakra gained 4.1% to the day’s high of Rs 3,252.85. Other stocks which also fared on the same lines include Goodyear India (up 5%), Modi Rubber (up 5%), and Balkrishna Industries (up 2%).
The duty has been slapped on “new/unused pneumatic radial tyres with or without tubes and/or flap of rubber (including tubeless tyres) having nominal rim dia code above 16 (inch)” used in buses and lorries/trucks. The levy follows the recommendation for the same by Directorate General of Anti-dumping and Allied Duties (DGAD).
Earlier, Automotive Tyre Manufacturers’ Association (ATMA) had filed an application on behalf of the domestic producers — Apollo Tyres, JK Tyre Industries and Ceat, had approached DGAD for investigations in the dumping of tyres. In its recommendation, the DGAD had said the domestic industry has suffered material injury on account of the imports from China. It found that the tyres have been exported to India from the subject country “below normal value”.
Countries impose anti-dumping duties to guard domestic industry against the surge in below-cost imports. India has also imposed similar duties on import of several other products including steel, fabrics and chemicals from different countries including China. Anti-dumping steps are taken to ensure fair trade and provide a level-playing field to the domestic industry. They are not a measure to restrict import or cause an unjustified increase in the cost of products.