ceat share price: Ceat shares jump 11% after company’s Q2 earnings beats Street’s estimates

Shares of Ceat jumped 11% intraday to hit day’s high of Rs 2,642 on the NSE after the Indian tyre maker reported a sharp rise in second-quarter profit which beat estimates, as strong sales and lower expenses boosted margins.

The company reported a consolidated net profit of Rs 208 crore for the quarter ended September 30, compared with Rs 7.83 crore rupees a year earlier, when the company was hurt by higher raw material costs and a one-time expense related to employee payouts.

On a consolidated basis, the company’s revenue closed at Rs 3,053 crore while EBITDA margin stood at 15.1% which was an expansion of 202 bps versus Q1FY23-24.

On a standalone basis, the company’s revenue stood at Rs. 3,043 crore and EBITDA margin stood at 15%, an expansion of 180 bps versus Q1 FY2023-24. Net profit stood at Rs 199 crore.

Analysts, on average, expected a profit of Rs 152 crore rupees, Reuters reported according to LSEG data. Total quarterly expenses were down 2.5%, led by a 13.6% drop in input costs, the report said.

Mumbai-based CEAT is the first to report results among major tyre makers, which are expected to see some benefit from cooling raw material costs .

Ceat’s revenue for the three months to September 30 rose 5.5% to 3,053 crore rupees.Replacement demand – which for CEAT formed 53% annual sales – and steady sales of passenger and commercial vehicles are expected to help overall industry volumes grow 6% to 8% for the financial year 2024, Crisil Ratings had said in a note last month.

“The demand continues to be stable, and we are witnessing mid-single-digit growth in our topline across all three segments – replacement, OEMs, and international business. Our focus on product mix and judicious pricing helped improve margins during the quarter,” said CEAT Chief Executive Officer, Arnab Banerjee.

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