Rubber Stocks in India: What Makes Them A Good Investment Choice?
Rubber Stocks in India: An Overview
The rubber manufacturing industry plays an important role in the growth of our economy because India is known for being the world's third-largest producer after Brazil and Indonesia. In India, the biggest producer of rubber is Sikkim. They provide their products to downstream industries such as automobiles, furniture, tyres, furniture, footwear, clothes, doormats, rubber tubing, hose, etc. In this article, we are going to learn about rubber companies in India, a list of rubber companies in India, and the top 10 rubber manufacturing companies in India.
Rubber Industry in India
The rubber industry in India plays a major role not only in the development of the economy in India but also in the global economy. Rubber manufacturing in India exports rubber to more than 190 countries around the world. They also sell their products to companies where rubber is used as raw materials to make finished products. The top industries that use rubber are bicycle tyres and tubes, belts, camelback, etc. Out of all these industries, the tyre industry is the biggest consumer of rubber as they are accountable for more than 50% of the consumption of rubber. Moreover, rubber stocks India is rising due to the growing demand for rubber by the tyre industry.
Tyre is used in making vehicles and India ranked among the top 5 vehicle production in the world. In 2020, our country produced around 3.5 million vehicles. Moreover, India is also the biggest consumer of rubber as our country is the second largest 2-wheeler market in the world.
Rubber manufacturers in India are situated in a few states. Kerala is accountable for more than 90% of rubber manufacturing in India. The government of India has allowed foreign direct investment (FDI) to push the growth of rubber companies in India
- The rubber manufacturing industry in India has seen steady growth over the past year.
- India is among the top largest producers of rubber as well as the third largest consumer of rubber in the world.
- Investors can earn lucrative returns by investing in the top 10 rubber manufacturing companies in India.
Top 10 Rubber Manufacturing Companies in India
|Company name||Market cap (Rs. Cr. )||P/E||ROCE (%)|
|Somi Conveyor Beltings Ltd||51.8||27.0||6.46|
|JK Tyre & Industries||4,143||20.9||9.32|
|Elgi Rubber Company Ltd||170||NA||1.96|
|Tube Investment of India Ltd||51,585||62.4||29.4|
|Balkrishna Industries Ltd||37,169||26.3||23.8|
(Data as of 12 October 2022)
Disclaimer: The securities quoted are exemplary and not recommendatory. Past performance is not indicative of future returns
Best Rubber Stocks in India
Let's have a look at the top list of rubber manufacturing companies in India:
Apcotex Industries Ltd was established in 1980 and is one of the top suppliers of synthetic rubber. They sell rubber-based raw materials to various industries that deal in Automotive components, tyres, hoses, construction gloves, etc for producing finished products. As of 12 October 2022, the current price of this stock is Rs. 559 and the market capitalization is Rs. 2,896 Cr.
The company is among the top manufacturers of mechanical power transmission products and belts. They also produce lawn and garden belts, industrial belts, agricultural belts, power ware products, and automotive belts. The company is listed in both NSE and BSE. As of 12 October 2022, the current market price of the stock is Rs. 869 and the total market capitalization is Rs. 1,185. Over the last five years, the company is growing at 34.1% CAGR (Compounded annual growth rate).
Indag Rubber Ltd. was established in July 1978 and they are known for manufacturing tread rubber. As of 12 October 2022, the market capitalization of the company is Rs. 197 Cr. and the current market price is Rs. 75. Also, the company has low debt and provides a dividend yield of 3.20% to their shareholders.
The company manufactures silicon-coated and talcum-coated heat-resistant rubber threads and is one of the largest rubber producers in India. They have a wide distribution network in India to ease the distribution process. The company has a global presence in the U.S and European countries. As of 12 October 2022, the current market price of the company is Rs. 90.2 and the market capitalization is Rs. 489 Cr. The company has a low debt-to-equity ratio and has delivered a 30% compounded annual growth rate over the last five years.
The company was established in 1974 and they manufacture upscaled polyamide from nylon waste, rubber from used tyres, and engineer products die-cut from end-of-life tyres. As of 12 October 2022, the market capitalization of the stock is Rs. 255 Cr and the current market price is Rs. 1,920.
To conclude, investing in stocks in the rubber manufacturing industry can be a good investment option as they are found nearly everywhere around us. It is used in a wide range of products such as footwear, pharmaceuticals, tyres, textiles, and various other products. However, you must do proper research and analysis of the rubber stocks India you are willing to invest in.
This is not an investment advisory. The blog is for information purposes only. Investments in the securities market are subject to market risks, read all the related documents carefully before investing. Past performance is not indicative of future returns. Please consider your specific investment requirements, risk tolerance, goal, time frame, risk and reward balance, and the cost associated with the investment before choosing a fund, or designing a portfolio that suits your needs. The performance and returns of any investment portfolio can neither be predicted nor guaranteed.
Is investing in rubber manufacturing companies good?
Investing in rubber manufacturing companies can be a good investment because it is used in our everyday life.
Can I buy rubber as a commodity in the stock market?
Yes, you can trade rubber in futures contracts. However, you have to ask for special permission from your broker to trade in commodities futures contracts. Commodity trading not only allows you to trade in rubber but also in other commodities such as agricultural products, raw materials, gold, natural gas, crude oil, etc.
How can I invest in the top rubber company in India?
You can invest in the top rubber stocks in the same way you invest in any other stock. All you need to do is to open a Demat account and start investing!
What are the top 10 rubber manufacturing companies in the world?
The top 10 rubber manufacturing companies in the world are
- Continental AG
- Bridgestone Corp
- Michelin SCA
- Goodyear Tire & Rubber Co.
- Yokohama Rubber Company
- Hankook Tire Co.
- Sumitomo Rubber Industries
- Zhongce Rubber Group
- Cheng Shin Rubber Industry Co.