Latest news with #Ceat
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Business Standard
4 days ago
- Automotive
- Business Standard
Expect double-digit growth in FY26, rural demand to drive sales: Ceat CEO
Tyre maker Ceat Ltd expects to maintain a double-digit growth this fiscal with domestic replacement segment, specially from rural markets, to drive sales while direct supplies to automobile makers are likely to be muted, according to company MD & CEO Arnab Banerjee. The company is also waiting and watching the tariff situation in the US, a big growth market but not a significant one right now for it, to decide its future course of expansion in the country, he told PTI. "We have started with a double-digit growth in Q1, which we have maintained last year also. We expect to maintain or accelerate that over the next two to three quarters," he said when asked for the outlook of the remainder of the fiscal. In the first quarter ended June 30, 2025 the company's revenue stood at Rs 3,529.4 crore, up 10.5 per cent year-on-year. As for the growth drivers, Banerjee said the two-wheeler replacement segment in the rural market is expected to do well across segments. "On the replacement side, rural demand should be good because monsoons have been good. So we expect rural demand to be robust. Then adoption of electric vehicles specially scooters etc is going strong," he said. Banerjee further said, "There will be some demand softness in the passenger cars side, which is dependent on larger towns but we are seeing a big shift there also from smaller size tyres to larger size tyres. Value growth could be there, margin growth could be there. In terms of the number of tyres, growth may not be that robust." Truck and bus radial tyres in the commercial vehicles segment will continue "to do decent", he noted. However, on the direct supplies to automakers, he said, "OEM growth in two-wheelers has slowed down and passenger vehicle is low single digit. It is going to continue like that unless there are some big launches which create excitement in the market." Medium and heavy commercial vehicles (M&HCV) could also slow down once the pre-buying before AC cabin regulation comes in (from October 1 this year), he said, adding "it may slow down a little bit. So, on the OEM side, slowdown is expected". When asked about the impact of Trump tariff uncertainty, Banerjee said, "The impact on our international business is low because our stakes are low in the US. Materially it is not significant but it is a big growth market for us." The US market accounts for about 3 per cent of the company's total sales. "We are waiting and watching...," he said, adding Ceat would wait for the tariff situation to settle down to plan its future growth strategy in the US. Asked if the company would look at local manufacturing in the US, he said, "We have not thought that far as yet but we are just waiting for the tariff situation (to settle down) and how the pricing will move in the US." Noting that there will be inflation on imported tyres, Banerjee said the US is hugely dependent on imported tyre, not only from India but from various countries. About the European market, he said Q1 was not good as distributors and channels were not stocking due to global geopolitical uncertainty. "However, for Q2 we have good order visibility, more of a seasonal offtake...Q2 order base is very good. Seasonal offtake is very good and if we execute it well, it will be good and from there we will see what happens in Q3 and Q4," Banerjee noted.
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Business Standard
5 days ago
- Automotive
- Business Standard
Tyre industry to grow 7-8% in FY26, driven by replacement demand: Crisil
India's Rs 1 trillion tyre industry is expected to post a steady revenue growth of 7–8 per cent in FY26, driven largely by robust replacement demand, which accounts for nearly 50 per cent of the sector's annual sales, according to Crisil Ratings. Rising premiumisation trends are also expected to aid realisations marginally, even as original equipment manufacturer (OEM) offtake remains subdued and global trade headwinds cloud the outlook. Crisil forecasts volume growth at 5–6 per cent, similar to the last fiscal. The replacement segment is expected to grow 6–7 per cent on the back of a large vehicle base, rural recovery, and strong freight movement. OEM volumes, which contribute roughly 25 per cent, are projected to rise 3–4 per cent, buoyed by steady sales in two-wheelers and tractors, with modest gains from passenger and commercial vehicles. Exports, also contributing 25 per cent of volumes, are likely to grow 4–5 per cent, supported by demand from Europe, Africa, and Latin America. Tyre maker Ceat sees signs of optimism. 'We expect raw material prices to decline by 1–2 per cent in Q2 over Q1, largely due to softening crude oil and international rubber prices,' said Kumar Subbiah, CFO and Executive Director of Ceat. 'If demand stays stable, this could positively impact our margins. The trend looks encouraging, and we are hopeful of margin recovery.' Crisil also pointed out that operating profitability is expected to remain stable at 13–13.5 per cent, supported by steady input costs and high capacity utilisation. Input cost pressure has been easing, offering some relief to manufacturers. Natural rubber prices had surged 8–10 per cent in FY25, alongside increases in crude-linked inputs like synthetic rubber and carbon black, eroding margins by nearly 300 basis points. However, the industry faces external risks. The US, which made up 17 per cent of India's tyre export volume last fiscal (and 4–5 per cent of total industry volume), has imposed reciprocal tariffs on Indian goods, potentially hurting competitiveness. Moreover, steep US tariffs on Chinese goods could push Chinese producers to dump excess inventory in price-sensitive markets like India. Although India has a 17.57 per cent anti-dumping duty on large truck and bus radials from China, other segments remain vulnerable. 'Price competition could intensify if low-cost Chinese tyres flood the Indian market,' warned Poonam Upadhyay, Director at Crisil Ratings. 'This is particularly worrying for the already competitive replacement segment.' Despite ongoing cost pressures, the sector's financial resilience remains strong, aided by conservative balance sheets and prudent capital spending. Capex is expected to remain steady at around Rs 6,000 crore, focused on high-utilisation segments such as passenger car radials and two-wheeler tyres, automation, and backward integration. The top six tyre makers, who account for 85 per cent of industry revenue, are expected to maintain a healthy financial profile, with interest coverage improving to 8.0 times and debt-to-Ebitda ratio easing to 1.0 from 1.3 last year.
Business Standard
5 days ago
- Business
- Business Standard
Ceat slips after Q1 PAT slides 27% YoY to Rs 112 cr
Ceat fell 1.67% to Rs 3,790.80 after the company's net profit declined 27.06% to Rs 112.45 crore on a 10.54% increase in revenue to Rs 3,529.41 crore in Q1 FY26 over Q1 FY25. The revenue growth was driven by a strong performance in both the OEM (Original Equipment Manufacturer) and replacement segments. The company reported profit before exceptional items and tax of Rs 159.04 crore in Q1 FY26, compared to Rs 195.41 crore recorded in the same period a year ago. The firm reported exceptional items of Rs 3.29 crore during the quarter. EBITDA for Q1 FY26 marginally declined 0.5% to Rs 386.2 crore, compared to Rs 388.2 crore in Q1 FY25. EBITDA margin reduced to 10.9% during the quarter as against 12.2% in the same quarter the previous year, primarily due to an increase in raw material (RM) costs. On the margins front, the company's operating margin reduced to 10.94% in Q1 FY26, compared with 12.16% recorded in Q1 FY25. Net profit margin declined to 3.18% in Q1 FY26 from 4.83% registered in Q1 FY25. In Q1 FY26, capital expenditure (capex) amounted to approximately Rs 231 crore. Arnab Banerjee, MD & CEO, CEAT, stated, We continue to grow at a strong pace with double-digit growth in top-line, driven by OEM and replacement segments. Looking ahead, we are well poised to ride the premiumization and electrification trend in the domestic market and renew our growth in international markets with stability in the geopolitical situation. Kumar Subbiah, CFO of CEAT, said, "Q1 saw strong growth and high-capacity utilization at all our manufacturing facilities. This growth came on the back of an increase in demand from OEM and replacement segments. As Q1 is a marketing-heavy quarter with significant marketing costs associated with IPL, operational margins saw a slight dip. Efficient cash flow management helped in gross debt coming down by Rs 100 crore during the quarter. Meanwhile, the board has approved the reappointment of Arnab Banerjee as managing director and CEO for another two-year term, starting 1 April 2026, pending shareholder approval. Additionally, CEAT announced a capital expenditure plan of around Rs 450 crore to expand its Chennai plant located at Kannanthangal, Sriperumbudur, in Kancheepuram district. The plant currently operates at 80% capacity and produces about 70 lakh tires annually. The planned expansion, expected to be completed by the end of FY27, aims to increase production capacity by roughly 35%, particularly in the Passenger Car Utility Vehicle (PCUV) segment. The investment will be financed through a combination of internal funds and debt. CEAT anticipates strong medium-term growth in the PCUV segment and plans to boost capacity to meet growing demand. CEAT, the flagship company of RPG Enterprises, is one of India's leading tire manufacturers and has a strong presence in global markets. CEAT produces more than 41 million high-performance tires, catering to various segments like 2-wheelers, passenger and utility vehicles, commercial vehicles, and off-highway vehicles.
Economic Times
6 days ago
- Business
- Economic Times
Ceat shares slip 2% after reporting 9% YoY decline in Q1 PAT
Ceat shares slipped 2% to their intraday low of Rs 3,779.25 on the BSE on Friday after the company reported its financial results for the first quarter of FY26, with a notable decrease in its net profit. The company's profit after tax (PAT) for Q1FY26 stood at Rs 135.5 crore, reflecting a decline of 9.2% compared to Rs 149.24 crore in the corresponding period of the previous fiscal year. ADVERTISEMENT Despite the dip in profit, Ceat saw an 11.1% year-on-year growth in its revenue, which rose to Rs 3,521 crore in Q1FY26 from Rs 3,168 crore in the same period last year. The revenue growth was driven by increased demand for the company's products, which contributed to the overall sales performance during the quarter. The company's earnings before interest, taxes, depreciation, and amortisation (EBITDA) also saw a modest increase of 2.5%, standing at Rs 391.01 crore in Q1FY26, compared to Rs 381.33 crore reported in Q1FY25. This indicates a slight improvement in the company's operating performance, although the growth in EBITDA was not as substantial as the revenue increase. Ceat's EBITDA margin, however, showed a contraction, falling by 93 basis points to 11.1% in Q1FY26 from 12% in Q1FY25. This decline in margin reflects a slight pressure on the company's profitability despite the increase in revenue and EBITDA. Also read: FIIs raise stakes in smallcaps: 8 stocks surge over 50% in 2025, 2 become multibaggers The shares of Ceat have increased by 41.43% over the past year, 20.53% Year-to-Date (YTD), 27.60% in the past 6 months, 27.56% over the last 3 months, and 7.34% over the past 1 month, with no decreases reported in any of these periods. ADVERTISEMENT On Thursday, the shares of Ceat closed flat at Rs 3,855.25 on the BSE. (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times) ADVERTISEMENT (You can now subscribe to our ETMarkets WhatsApp channel)
Time of India
6 days ago
- Business
- Time of India
Ceat shares in focus after reporting 9% YoY decline in Q1 PAT
Ceat Ltd has reported its financial results for the first quarter of FY26, with a notable decrease in its net profit. The company's Profit After Tax (PAT) for Q1FY26 stood at Rs 135.5 crore, reflecting a decline of 9.2% compared to Rs 149.24 crore in the corresponding period of the previous fiscal year. Despite the dip in profit, Ceat saw an 11.1% year-on-year growth in its revenue, which rose to Rs 3,521 crore in Q1FY26 from Rs 3,168 crore in the same period last year. The revenue growth was driven by increased demand for the company's products, which contributed to the overall sales performance during the quarter. The company's earnings before interest, taxes, depreciation, and amortisation (EBITDA) also saw a modest increase of 2.5%, standing at Rs 391.01 crore in Q1FY26, compared to Rs 381.33 crore reported in Q1FY25. This indicates a slight improvement in the company's operating performance, although the growth in EBITDA was not as substantial as the revenue increase. Ceat's EBITDA margin, however, showed a contraction, falling by 93 basis points to 11.1% in Q1FY26 from 12% in Q1FY25. This decline in margin reflects a slight pressure on the company's profitability despite the increase in revenue and EBITDA. Also read: FIIs raise stakes in smallcaps: 8 stocks surge over 50% in 2025, 2 become multibaggers Live Events Ceat share price history The shares of Ceat have increased by 41.43% over the past year, 20.53% Year-to-Date (YTD), 27.60% in the past 6 months, 27.56% over the last 3 months, and 7.34% over the past 1 month, with no decreases reported in any of these periods. On Thursday, the shares of Ceat closed flat at Rs 3,855.25 on the BSE. ( Disclaimer : Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
