Impact of retreading on Indian Natural rubber

At present, in India, the tyre retreading industry is a highly fragmented, with over 80% of the market share, lying with unorganized participants. However this industry is expected to witness strong growth of CAGR 8-10% owing to various factors such as strong radialization growth, improved road infrastructure etc. Also, retreading and replacement are two different routes for the used tyres and both of these activities require natural rubber. The strength of consumption of NR will depend on which of these segments is expected to have a stronger growth in the future. India, nevertheless, faces a severe supply crunch for NR owing to which it has to rely on imports to meet its NR requirement. At present the share of the commercial vehicle segment comprises of 80% biaxial tyres and 20% radial tyres. But both these segments are expected to have different growth rates, with the radial segment expected to have a phenomenal growth rate of 19% while the biaxial segment may grow by 4-5% in the coming years, after which it is expected to be stagnant. This trend may also result in different retreading and replacement growth patterns and the resultant requirement for natural rubber maybe different for such a scenario.