CEAT reports two fold boost in net profit

CEAT recently posted its June 2015 quarter result.The company reported a flat revenue at Rs 1466 crore with 0.26 per cent growth in Q1FY15 compared to same period in previous financial year.Its total expenditure decreased by 6.26 per cent to Rs 1242 crore in Q1FY16 on yearly basis. CEAT's total expenditure declined majorly due to a 12.2 per cent reduction in raw material prices during the June 2015 quarter.

The EBITDA of CEAT rocketed by 63.24 per cent to Rs 224 crore in Q1FY16 from Rs 137 crore in Q1FY15. The company's EBITDA margin considerably expanded to 15.29 per cent with an expansion of 590 basis points on yearly basis because of operational efficiency. Its PBT boosted by 129.06 per cent to Rs 183 crore in Q1FY16 on yearly basis as interest expense decreased by 34.91 per cent to Rs 25.62 crore during the quarter. CEAT's net profit rose by 134.24 per cent to Rs 121 crore in Q1FY16 compared to same period in previous financial year. The company's net profit margin expanded by 449 basis points to 40.45 per cent in Q1FY16 on a yearly basis. Its debt to equity has come down from 1.0 times in Q1 last year to 0.4 times this quarter.

CEAT's shareholding pattern indicates that FII holdings contracted by 100 basis points to 21.28 per cent and DII holdings expanded by 45 basis points to 8.15 per cent during June 2015 quarter. The stock price on BSE increased by 7.83 per cent and trading at Rs 819.25 intraday.

CEAT stock included in future and options (F&O) segment with effect from May 29, 2015. The company is planning a two-wheeler segment tyre expansion plant in Nagpur by adding almost 10 lakh tyres per month.

CEAT is the flagship company of RPG Enterprises and manufacturer of automotive tires, tubes and flaps. It is one of India's  leading tyre manufacturers with a capacity of over 700 tonnes per day.The Company exports its products to domestic and international markets. Its tire range includes bikes, car, sports utility vehicles (SUV), farm vehicles, light commercial vehicles (LCV), trucks and over the road (OTR). CEAT owns two tire manufacturing facilities at Bhandup and Nasik in Maharashtra. The company has a Greenfield radial tire manufacturing facility at Halol in Gujarat.