On a low equity base of Rs 3 crore, EPS works out to Rs 8.53 for the fiscal 1998. At present, the scrip is trading at at an attractive P/E of only 1.52.A part of the Chabria group, Falcon Tyres has recorded a net profit of Rs 2.56 crore (up 21 per cent) on a turnover of Rs 98 crore for 1997-98.

Turnover has registered a rise of 14 per cent. For the fiscal 1997, the company had recorded a net profit of Rs 1.78 crore on turnover of Rs 82.34 crore. In fact, in the first half of the fiscal 1998 itself, the company had surpassed the fiscal 1997 full-year net profit figure of Rs 2.56 crore on aturnover of Rs 40.37 crore. For the fiscal 1998, profits before tax stood at Rs 4.95 crore, a rise of 44 per cent over the last fiscal.

After going into the BIFR net in 1987, Falcon Tyres had turned around. The company uses the knowhow and brand name of Dunlop, which took 47 per cent stake in the then ailing Falcon in 1987. However, despite Dunlop's majority holding, the company functions independently.

The company now plans to strengthen exports, especially to neighboring countries, and enter the cycle tyres market shortly. The company, which enjoys goodwill in the original equipment segment, also plans to enter the replacement market. An investment around Rs 7.6 crore will be incurred on expansion and modernisation plans in 1998.

In 1997, manufacturing capacity for two and three-wheelers tyres was two lakh units and by the year end, it stood at three lakh units. Falcon also exports tyres to several countries. While the demand for tyres has fallen, there has been a boom in two and three-wheelers.While mopeds were going out of fashion, motorcycles were leading with an increase in demand last fiscal of about 15 per cent. The scooters market had grown by two per cent.