CEAT Ltd Navigates Profit Dip with Strategic Investments

CEAT Ltd reported a 27.16% decline in its consolidated net profit for the June quarter, attributed to rising raw material costs. Despite this, the company plans to invest Rs 450 crore to expand capacity at its Chennai plant, aiming to capitalize on growth opportunities in the domestic and international markets.

CEAT Ltd, a prominent tyre manufacturer, reported a noticeable 27.16% drop in its consolidated net profit for the June quarter, attributing this decline to increased raw material costs. The company announced an investment of Rs 450 crore to expand the capacity at its Chennai plant, aiming to meet growing demand.

The consolidated revenue for the first quarter stood at Rs 3,529.41 crore, up from Rs 3,192.82 crore in the same period last year. Total expenses rose to Rs 3,375.1 crore, driven by higher raw material costs, which reached Rs 2,238.76 crore, CEAT Ltd informed in a regulatory filing.

CEAT Ltd's CEO, Arnab Banerjee, expressed optimism about the company's growth, highlighting the expansion in domestic and international markets and adaptation to premiumisation and electrification trends. The expansion at the Chennai plant is set to increase capacity by 35% for passenger cars and utility vehicles by FY27, backed by internal funds and debt.

(With inputs from agencies.)