Cheap imports key concern for tyre makers: Sachin Shah

In a chat with ET Now, Sachin Shah, Fund Manager, Emkay Investment Managers, talks about tyre stocks.

ET Now: Auto component now seems to be a dead and buried story. Nobody talks about auto ancillary stocks anymore. A lot of benefits because of lower rubber and crude prices, somehow that sheen is now coming off. What is the house view on the tyre names?

Sachin Shah: The growth in sales reported by tyre companies is not very exciting at this point in time. We have seen the benefits of falling raw material prices. But we are now seeing a lot of competition coming from the import side. That is affecting the margins and the realisations of domestic tyre makers. So that is the biggest worry as far as the tyre companies are concerned at this point in time.