CEAT Limited, one of India’s major tyre manufacturers, delivered strong top-line growth in the second quarter of FY27 while profitability deteriorated sharply, marking another “revenue up, profit down” scenario for the global tyre industry.
In this quarter, the group recorded consolidated sales of INR 47.62 billion, rising 26% year over year. Consolidated net profit dropped 39.8% YoY to INR 1.12 billion. Its EBITDA margin narrowed from 13.53% to 9.5% due to inflated input expenses.
Premium tyre products across business units were the key growth engine for sales. Higher rubber raw material costs and supply chain bottlenecks arising from ongoing geopolitical tensions in the Middle East weighed heavily on earnings.
The tyre producer adopted stricter cost management and allocated nearly INR 4.9 billion in capital expenditure this quarter to expand high-utilisation production capacity.
The finance chief forecasts commodity cost pressure will continue through Q3. The business intends to implement selective price revisions and optimise product mix to lift margins. The management aims to achieve double-digit sales growth again in H2 FY27.
This earnings report serves as a representative snapshot of worldwide tyre manufacturing. Even with recovering market demand and higher sales from premium tyres, raw material price swings and geopolitical risks continuously compress manufacturers’ profit space. Adjusting selling prices and upgrading product structure remain the main tools tyre companies use to counter rising material costs.
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