CEAT shares crash 9% after Q1 web revenue tumbles 96% YoY to Rs 4 crore. What lies forward?
The shares of the corporate plunged to Rs 3,471.10 apiece on NSE on Friday. If the inventory manages to carry on to the sharp losses, then right this moment’s plunge would mark the most important single-day fall because the notorious COVID-19 crash of 2020.
CEAT Q1 earnings
CEAT on Thursday reported the sharp plunge in web revenue from the Rs 112 crore reported in the identical interval of the earlier monetary yr, as greater uncooked materials prices weighed on profitability. The tyre-maker’s income from operations in the meantime grew 22% YoY to Rs 4,318 crore in Q1 FY27 from Rs 3,534 crore in Q1 FY26. “Q1 was a difficult quarter for the trade. The persevering with West Asia disaster led to important uncooked materials price inflationwhich weighed on our gross and working margins. We responded with calibrated worth will increase to partially offset the influence, whereas staying centered on demand and market share,” stated CEAT MD and CEO Arnab Banerjee.
He famous that regardless of the pressures, the tyre-maker delivered sturdy double-digit income progress of twenty-two% year-on-year, supported by wholesome demand throughout segments and high-capacity utilisation. “As we enter Q2, we’ll proceed to take disciplined method to pricing whereas staying centered on worthwhile progress,” he added.
Additionally Learn | CEAT Q1 web revenue drops 96% to ₹4 crore
CEAT’s board additionally permitted a Rs 1,205 crore funding in the direction of increasing manufacturing capability within the two-wheeler tyre phase. CEAT CFO Kumar Subbiah stated commodity price inflation as a result of West Asia Warfare had a big influence on the agency’s uncooked materials prices, resulting in drop in Q1 margins. “We now have taken cumulative worth will increase of 5%. We count on uncooked materials prices prone to stay at an inflated degree in Q2 and therefore, we’ll proceed to stability our pricing actions and price prudence to progressively mitigate the influence on our margins,” he added.
Motilal Oswal on CEAT share worth
Motilal Oswal Monetary Providers highlighted that CEAT’s Q1 earnings print had been far beneath its expectations as a consequence of considerably higher-than-expected curiosity prices, regardless of margins coming in-line with our expectations.
Web gross sales nevertheless grew over 22%, beating its estimates, helped by wholesome YoY quantity progress throughout segments. Worldwide enterprise continues to get better effectively and was the fastest-growing phase YoY, the home brokerage added.
The home brokerage has a ‘Purchase’ name on the shares of CEAT. “The inventory at present trades at 25.2x/16.3x FY27E/FY28E P/E,” it stated.
CEAT share worth
CEAT shares have fallen round 10% in a single month and are down 6% in 2026 to date. In the long term, the shares of the corporate have delivered a unfavorable return of 8% in a single yr, however gained 45% in three years and 145% in 5 years.
The corporate at present has a market capitalisation of practically Rs 14,346 crore. The inventory’s P/E ratio stands at 27x.
Additionally Learn | RIL Q1 technique: The best way to commerce Reliance Industries shares forward of June quarter earnings?
(Disclaimer: Suggestions, options, views and opinions given by the consultants are their very own. These don’t signify the views of The Financial Instances)
