Despite macroeconomic and global challenges affecting the tyre industry, India's leading tyre manufacturer CEAT Ltd expects a double-digit growth in revenue in FY2025-26.
“In the fiscal and the quarter (Q4FY25) gone by, we delivered double-digit growth. We would have grown higher than the industry in FY25. While there are some macroeconomic challenges like the US tariff, we are again targeting double-digit growth in FY26,” Kumar Subbiah, CFO of CEAT, told The New Indian Express.
The company reported a 14.3% year-on-year rise in Q4 revenue to ₹3,420.6 crore, up from ₹2,991.9 crore in the same quarter last year. However, net profit declined 8.4% to ₹99.5 crore compared to ₹108.6 crore in Q4 FY24. Despite this, CEAT’s shares surged 8% on Wednesday, reflecting investor optimism.
Subbiah highlighted strong growth in the replacement market (55% of revenue) and international business (20% of revenue) last fiscal. The company aims to increase its overseas revenue share to 25% in the next two years.
For FY26, CEAT has earmarked ₹900-1,000 crore in capital expenditure, primarily for expanding passenger car tyre and truck/bus radial tyre capacities. This follows last year’s capex of ₹946 crore.
On US tariff concerns, Subbiah noted that CEAT’s exposure to the US market is below 5%, minimizing potential risks. However, he cautioned that the industry must monitor whether China increases tyre dumping in global markets.
“In India, we have antidumping duty, particularly in the truck and bus radial category. As far as the Indian market is concerned, we do not see a threat of dumping. However, if Chinese tyres flood into other markets where we are also competing, then we will have to assess the impact,” he said.
Talking about softening raw material prices, the CFO said that crude oil prices are currently hovering at about $65 level and international natural rubber prices, even though higher than last year, has seen a correction of about 10% in recent months. “The impact of softening raw material prices may be seen in the coming months,” he stated.