CEAT Ltd share Price Today

CEAT, part of RPG group is one of the India’s most reputable tyre manufacturers established in 1958. It has prominent presence in India as well as in key international markets with 7 manufacturing plants & 51,000+ sales touchpoints.

• FY22 Channel Mix: Auto OEMs: 24%; Replacement: 56%; Exports: 20%  
• FY22 Segment Mix: PV: 18%; CV: 40%; Farm & OHT: 14%; 2W: 28%
• It is presently operating at ~80% capacity utilization levels
• It has ~4,600+ dealers, 380+ CEAT exclusives, presence in >110 countries

• Domestically, company is witnessing healthy demand traction from the OEM’s front with replacement demand being steady in nature. Robust demand is particularly being witnesses in the PV space with chip supply issue easing while steady MoM improvement is seen in the CV space
• On the exports front, demand in Europe & Indonesia is muted amid negative economic scenario. Sri-Lanka on the other hand is witnessing 50-60% decline in volumes with CEAT earning steady margins (unchanged).
• On Margins front company expects Q2FY23 to be on similar lines as Q1FY23 with recovery seen from Q3FY22 onwards. Overall company aims to achieve ~10%-12% operating margins over medium term. Replacement market business remains more lucrative in terms of margin than the OEM.
• Over past 3 years’ company has expensed ~₹3,300 crores out of planned ~₹4,000 capex w.r.t capacity building across Chennai and Ambernath plant. Capex for FY23E is planned at ~₹900 crores while the same for FY24E is seen at ~₹ 700 crore, with peak revenue potential pegged at ₹13,000 crore.
• Company remains committed towards keeping Debt/EBITDA at <3x.

Auto tyres & Rubber products company Ceat announced Q4FY24 results:

Financial Highlights:

• On a consolidated basis, the Company’s revenue closed at Rs 2,991.9 crore, EBITDA margin stood at 13.4%, a contraction of 97 bps vs Q3FY24. Net profit stood at Rs 102.3 crore. 
• On a standalone basis, the Company’s revenue stood at Rs 2,979.2 crore and EBITDA margin stood at 13.3%, a contraction of 89 bps vs Q3FY24. Net profit stood at Rs 119.1 crore.

Commenting on the results as well asthe outlook of the business, Arnab Banerjee, MD & CEO, CEAT said, “The company ended the year on a positive note, we saw recovery in volumes in the second half of the quarter in replacement and international markets with stable margins for the quarter and significant improvement in the margins on full year basis and expect the positive momentum in Q1FY25. We have achieved commendable growth, largely attributable to share gain in passenger categories both in 2W and 4W and substantial expansion within the export segment. Overall, our profits & margins grew significantly during the year. The operating margins for the quarter includes additional provision made towards Extended Producers Responsibility (EPR) related requirement imposed on Tyre Industry by the Government of India."

Kumar Subbiah, CFO of CEAT, said, “As part of our continuous effort to bring efficiencies in cashflow, it has helped us reduce our consolidated gross debt by approximately Rs 100 crores in the quarter, supported by improved operational performance. The actual overall capex for the year was close to approx Rs 860 crore in line with our plan that we managed to fund through internal accruals. It has been a gratifying year overall, marked by positive free cash flow, significant reduction in debt, improvement in operating margins and the maintenance of healthy balance sheet leverage ratios.”

Result PDF