Top tyre companies in India; Glimpse of CEAT Ltd Q1 results inside

The Indian automotive sector has witnessed remarkable expansion, leading to an increased requirement for top-notch tyres over the last decade. Consequently, the Indian market now boasts a plethora of tyre companies, each providing an extensive array of products to meet the varied demands of consumers.

Like selecting the appropriate tyre for your vehicle to ensure a comfortable driving experience, making the right investment decision in tyre company stocks is equally crucial when considering investing your hard-earned money.

While purchasing tyres we consider factors such as vehicle type, driving conditions, and budget, it is imperative to consider essential metrics and financial indicators before investing in any tyre company’s stocks. These critical indicators may include sales and its growth, profit and its growth, profit margins, return ratios, debt structure, share performance, and other relevant factors to make informed investment choices.

A tyre is an essential component of any vehicle, influencing its performance, safety, and fuel efficiency. As the Indian automotive industry continues to flourish rapidly, it is expected to become the world’s third-largest market by 2026. This surge in automobile production has significantly boosted the demand for tyres, contributing to the growth of the tyre industry in the country.

Following the Tyres companies listed in the Indian Market:

 Among the companies mentioned above, each one brings its unique strengths and contributions to the table. Upon analysing their past stock returns, it is evident that three of these companies have outperformed the others by delivering over 100% returns. These top-performing companies are Apollo Tyres, CEAT Tyres, and JK Tyres.

However, it’s worth noting that MRF, while being the most expensive stock in the entire Indian stock market, has delivered a comparatively modest return of 28% over the last year. On the other hand, Balkrishna Industry, which holds the top position in terms of market capitalization amounting to Rs 47,000 crore, has delivered a return of a mere 5.89% in the same one-year period.

CEAT Q1 FY24 result

Let’s briefly review the recent quarterly results of CEAT Ltd, which were announced by the company yesterday. CEAT reported YoY revenue growth of 4.14%, with revenues increasing from Rs 2,818 crore to Rs 2,935 crore.

The company’s operating profit also demonstrated significant growth, reaching Rs 387 crore compared to Rs 165 crore in the same quarter of the previous year. This improvement resulted in an operating profit margin of 13%. CEAT achieved a net profit of Rs 144 crore for the same period, marking the highest net profit in the last eight quarters.

Furthermore, the Board of Directors at its meeting held on May 04, 2023, had proposed a dividend of Rs 12 per equity share and it was approved by the shareholders in the AGM held on July 05, 2023. Consequent to this, the company transferred Rs 4,854 lakh on July 10, 2023, to Dividend Escrow Account.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet, and is subject to changes. Please consult an expert before making related decisions.