CARE has taken a consolidated view of JK Tyre & Industries (JKTI) in its analysis considering the enhanced debt in its subsidiaries and significant contribution from the same going forward.

The ratings assigned to the enhanced facilities of JKTI takes into account the improved operating profitability for the company in FY15 (refers to the period April 1 to March 31) and 9MFY16 (refers to the period April 1 to December 31) coupled with improvement in its capital structure. There was a continued expansion in PBILDT margin which is primarily attributed to decline in raw material prices coupled with change in product-mix with increased contribution from high margin radial tyres.

Furthermore, the ratings factor in the strength derived from the experience of the promoters, JK group's long-track record of operations, its established market position in Truck and Bus Radial (TBR) segment and wide marketing and distribution network. However, these rating strengths are partially offset by its working capital intensive nature of operations, exposure to foreign currency fluctuation risks and raw material prices volatility and competitive nature of industry.

Shares of the company declined Rs 0.2, or 0.22%, to trade at Rs 90.95. The total volume of shares traded was 96,081 at the BSE (1.40 p.m., Wednesday).