Ceat Q1 Results: Revenue, Profit Rise Even As Margins Take A Hit
Ceat Q1 FY25 Results: Net profit rose 7.1% year-on-year to Rs 154 crore on the back of revenue that increased 8.8% to Rs 3,193 crore.
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Ceat Ltd. saw its profit grow in the first quarter of fiscal 2025, even as operational profitability took a hit due to unfavourable input costs.
Consolidated net profit of the Mumbai-based tyremaker rose 7.1% year-on-year to Rs 154 crore in the quarter ended June 30, 2024, on the back of revenue that increased 8.8% to Rs 3,193 crore, according to an exchange filing on Thursday.
Analysts polled by Bloomberg had estimated the top line at Rs 3,098.8 crore and the bottom line at Rs 144.5 crore.
Ceat Q1 FY25 Results Key Highlights (Consolidated, YoY)
Revenue up 8.8% at Rs 3,193 crore (Estimate: Rs 3,098.8 crore).
Ebitda down 1.1% at Rs 387 crore (Estimate: Rs 390.6 crore).
Ebitda margin down 120 basis points at 12% (Estimate: 12.6%).
Net profit up 7.1% at Rs 154 crore (Estimate: Rs 144.5 crore).
One basis point is one-hundredth of a percentage point.
“The operations margin declined during the quarter, primarily due to increase in commodity costs and higher marketing spends,” Kumar Subbaiah, chief financial officer at Ceat, said in a statement.
The growth was driven by replacement demand, even as exports continued to recover on a sequential as well as annual basis, the company said in an investor presentation.
“Despite facing margin pressure from significant increases in raw material costs and ocean freight, we are actively mitigating these challenges through strategic price adjustments,” Ceat’s Chief Executive Officer Arnab Banerjee said in a statement. “Our strategic focus on premiumising passenger car tyres has begun to yield positive results.”
Debt increased by Rs 18 crore due to sequentially higher working capital requirements. The capital expenditure for the quarter stood at Rs 254 crore. Separately, the company made an additional investment of Rs 2.91 crore in wholly owned unit TyresNmore Online Pvt. Ltd. on 28 June 2024.
“Looking ahead, we anticipate continued momentum in volumes throughout the second quarter and beyond,” Banerjee said. “Additionally, we are front-loading our capex this year to ensure we are well-prepared to meet rising demand.”
On Thursday, Ceat shares rose 2.1% to Rs 2,784.40 apiece on the BSE even as Nifty 50 Index ended the day 0.76% higher. The quarterly results were declared after market hours.
