Business

CEAT shares fall after fall in profits in September quarter

Ceat’s operating profit margin rose 11 basis points year-on-year to 9.2 percent.

Shares of Mumbai-based tire maker – CEAT Ltd – fell up to 7.94 per cent to hit a low of Rs 1,191 in the second quarter of the current fiscal after its profit declined. Ceat’s net profit fell 77 per cent year-on-year to Rs 42 crore as compared to Rs 182 crore during the same period last year due to rising cost of living. However, the company’s revenue grew 27 per cent to Rs 2,452 crore from Rs 1,978 crore during the September quarter of the previous fiscal.

The company’s cost of consumption material increased by 54 per cent to Rs 1,661.6 crore as compared to Rs 1,052 crore during the same quarter last year.

Ceat’s EBITDA margin, also known as operating profit margin, rose 11 basis points year-on-year to 9.2 percent.

“Despite some gaps in the commercial and agriculture categories, the overall market demand remains strong. We witnessed a strong growth of 28 per cent over the previous quarter on the back of good performance in the replacement market, especially in the passenger segment. Rising cost costs “Our gross margins have been impacted, although partly offset by price adjustments in the last quarter,” Anant Goenka, managing director of CEAT, said in a statement.

CEAT shares have outperformed the Sensex 20 per cent so far this year, which has gained 28 per cent.

As of 10:57 am, Ceat shares were trading at Rs 1,232.50, down 4.71 per cent.

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