CEAT shares crash over 9% after tyre maker's Q1 profit plunges 96%
Mumbai/IBNS: Shares of CEAT Ltd. fell more than 9 percent on Friday after the tyre manufacturer reported a sharp decline in its first-quarter earnings for FY2027, according to media reports.
The stock was trading at Rs. 3,479.2 apiece on the National Stock Exchange (NSE), down from its previous closing price of Rs. 3,829.6.
Revenue grows, but profit nosedives
CEAT's revenue from operations rose 22.4 percent year-on-year to Rs. 4,318 crore in the first quarter of FY2027, compared to Rs. 3,529 crore in the corresponding period last year.
However, the company's net profit plunged 96.4 percent to Rs. 4 crore from Rs. 112 crore a year earlier, primarily due to higher raw material costs, foreign exchange losses and acquisition-related expenses.
Margins under pressure
The tyre maker's EBITDA declined 5.7 percent year-on-year to Rs. 365 crore, compared with Rs. 387 crore in the year-ago quarter.
Its EBITDA margin contracted to 8.5 percent from 11 percent, reflecting pressure on profitability amid rising input costs.
Investors react negatively
The weaker-than-expected earnings prompted a sharp sell-off in the stock, with investors reacting to the steep decline in profitability despite robust growth in revenue.
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