The Rs 50,000 crore Indian tyre industry (2014-15 sales as estimated by industry body ATMA) seems poised to do well in terms of profits in the current fiscal year, not withstanding cheap imports from China, especially in the truck and bus radial (TBR) segment.

Results posted by three tyre companies — Ceat, MRF and Apollo Tyres — for the second quarter ended September 2015 indicate that the industry is bound to register a modest growth, riding on the back of higher vehicle sales in the first six months of the current financial year.

Chennai-based MRF posted 45.4 percent rise in net profit at Rs 460.73 crore during the quarter ended September 2015, up from Rs 316.91 crore during the corresponding period last year, even as sales fell about 6 percent to Rs 3,327.21 crore during the quarter, down from Rs 3,548.4 crore.

"The Indian tyre sector continues to face heat from cheaper Chinese imports that have flooded the Indian market in the TBR segment, which can be partially responsible for the flat top-line number," said Milan Desai, Research Analyst, Mid-Caps, Angel Broking.

However, cheaper raw material costs have effectively offset the impact of Chinese imports. "Softer raw material prices, which came down in the later two months of the past quarter, aided in EBITDA margin expansion," Desai said.

Apollo Tyres, too, reported a decline in sales and a sharp rise in net profit. While sales were down 10.4 percent at Rs 2,996.93 crore during the quarter, from Rs 3,346 crore in the corresponding period last year, net profit was Rs 278.74 crore, up 8 percent from Rs 257.94 crore in the quarter ended September 2014.

"In the July-September quarter, TBR imports increased almost 100 percent, as compared to the same period last year, of which, the economy/Chinese brands contributed nearly 90 percent," said Onkar S Kanwar, chairman of Apollo Tyres Ltd.

RPG Group company Ceat also witnessed a similar trend for the quarter. Net income declined by a marginal 2 percent to Rs 1,409.42 crore, from Rs 1,437.77 crore in the year-ago quarter. Net profit at Rs 107.40 crore in the September 2015 quarter was up 30.4 percent from Rs 82.35 crore year on year.

The industry body Automotive Tyre Manufacturers Association (ATMA) had recently petitioned the Narendra Modi government recently to take corrective steps to check "unbridled imports of tyres", since imports account for almost 30 percent of the domestic TBR market.

The industry is pinning its hopes on the uptick in the automobile industry, which saw a marginal growth of 1.16 percent in production at 11,973,025 vehicles during the first half of the current fiscal, up from 11,835,239 units in the year-ago period, according to SIAM.

In terms of sales, while passenger vehicles grew 6.22 percent in the April-September period, the commercial vehicles segment saw a 7.18 percent growth year on year. This should augur well for the auto components industry, including tyres.