CSM – Trying to enter the automobile tyre business, again
CSM – Trying to enter the automobile tyre business, again
January 25, 2017
■ CSM’s new semi-steel tyre plant is about to begin producing tyres for export to the US, but we are not clear how competitive these products will be in the US market.
■ Rubber accounts for about half of CSM’s COGS, and world rubber prices have rebounded 60% from their Sep 2016 bottom.
■ We cut FY17 EPS forecast by 49% on disappointing results and a weak outlook for radial tyres. We reduce our TP and downgrade CSM from Add to Hold.
