BENGALURU (Reuters) – India’s MRF reported quarterly profit broadly in line with expectations on Friday, as the tyremaker benefited from softer raw material prices and steady demand for commercial vehicles.
Standalone profit from continuous operations jumped over fourfold to 5.72 billion rupees ($68.71 million) for the quarter ended Sept. 30, while analysts, on average, expected a profit of 5.71 billion rupees, according to LSEG data.
Steady demand for replacement tyres, and for commercial and passenger vehicles will drive up India’s tyre volumes in the current fiscal year, analysts at Crisil Ratings had said in September.
Analysts expected price hikes and premiumisation to help revenue growth in auto and auto ancillary firms in the second quarter despite the delay in the festive season.
A dealers body said last month that India’s retail vehicle sales rose 20% in September and forecast a strong festive season, with easing monsoon worries and higher rural demand helping sentiment.
MRF’s cost of materials consumed fell 9.7% to 37.15 billion rupees in the quarter, while total expenses also dipped 4.4%.
The Chennai-based company’s revenue from operations grew 6.4% to 60.88 billion rupees in the quarter.
Rivals CEAT and Goodyear India also reported a rise in their quarterly profits on lower input costs.
MRF shares, which have gained nearly 23% in market value so far this year, fell 2.3% after the results.
($1 = 83.2520 Indian rupees)
(Reporting by Meenakshi Maidas in Bengaluru; Editing by Eileen Soreng)
