India: Kesoram tyre unit buyout sparks concerns for JK Tyre investors

Shares of JK Tyre and Industries Ltd skid 3.5% lower on Monday in spite of a buoyant trading session. The third-largest tyre maker’s acquisition of a tyre unit owned by Kesoram Industries Ltd for an enterprise value of around Rs.2,200 crore did not go down well with investors. Even if the benefits of size and scale would accrue with time, the concerns outweigh the gain for the near to medium term.