As far as numbers are concern, the profits of all the companies (except TVS) were up in the range of 7% to 40%, while the revenues were increased up to 24% for the quarter ended on 31st March 2018.

The Common Parameter/s for such Performance for the Sector is/are –

The decline in Raw Material prices

GST-led destocking

Implementation of anti-dumping duty on Chinese truck-bus radial (TBR) tyres

Strong demand from the Auto manufacturers

Market Leader Performance –

In Q4 FY ’18 market leader MRF achieved 4.41% quarter-on-quarter (QOQ) growth in Revenues and 20.42% QOQ growth in Profits.

MRF is a leader in the Indian tyre industry with nearly 28% revenue market share.

The company has built up a strong brand since inception and has set up a terrible distribution network which helps in cater to a large number of customers.

Star Performer in the Sector –

The star performer in the sector for the quarter ended 31st March 2018 was Balkrishna Industries.

The company Revenues grew by 23.71% while the Profits were stood at INR 193.62 Cr up by 40.39% as compared to same quarter last year.

Tyre Sector Data –

Sector Outlook –

Indian Tyre companies posted a good set of numbers for the last quarter of FY18 backed by the (1) falling raw material prices and (2) overall good demand from the automobile manufacturers.

Going forward, the sector is likely to benefit most from the GST as well as anti-dumping duty levied on the Chinese truck-bus radial (TBR) tyre. However, raw material price instability is something that the sector has to deal with!

Again the end market looks exciting on the back of normal monsoon this year (IMD predicted) which can offer secular growth opportunities.

Also Read –

1) Finblab’s Valuepick Stock for the month of May – GMM PFAUDLER LIMITED

Disclaimer: The contents and data presented here are just for your information & personal use only. While much effort is made to provide the information, I ( Vishal Dalwadi ) or “Fin Blab” do not guarantee the accuracy, correctness, completeness or reliability of any information or data displayed herein and shall not be held responsible.

The post FINBLAB RESEARCH: TYRE Sector Q4 (Jan-Mar ’18) Numbers And Analysis appeared first on Upcoming ipos: Latest news on stocks, economy & finance.

Q3 (OCT to DEC) – FY 2017-18 was a quarter as far as Indian Tyre Manufacturers and Indian Tyre Industry is concern. Click here to see Q2 Results.

For the numbers, the revenues of all most all the companies were up in the range of 7% to 23%, while 3 companies out of 5 able to register growth in profits and 2 fails to do so as compared to same period last year.

The Common Parameter/s for such Performance for the Sector is/are –

Strong demand from the domestic markets as well as OEM

Market Leader Performance:

Market leader MRF has registered 6.56% growth in Revenues and 18.19% growth in Profits as compared to the same period last year.

Star Performer in the Sector:

The star performer in the sector for the quarter ended 31st December 2017 were MRF, Balkrishna Industries, and ApolloTyres where the companies Revenues grew upto 23%, while Profits grew upto 18% as compared to same period last year.

Here is the Data –

Future Outlook –

Q3 (OCT to DEC) was a good quarter for the Indian Tyre Companies thanks to the strong demand from the domestic market. Generally Q3 has been good for the Indian Tyre Industries since it is a that period of the year where monsoon season gets over and demands is always there.

Post implementation of the anti-dumping duty in September 2017, Chinese truck bus radial tyre imports declined to the 50,000 level from a peak of 140,000-150,000. This has augured well for players as is evident from the volume growth registered by the player in the industry.

After studying the results and from the management commentary one thing clear that upcoming quarter or years are likely to be good. Almost all the companies have invested heavily in some projects or the other. Let see

• MRF: Robust revenue growth can be attributed to its exclusive dealer network strength, which transitioned well, and strong OEM sales on the back of surge in PV sales.
• Balkrishna Ind: (1) Company planning to repay entire debt on books by August 2018. (2) In order to ensure raw material security and scaling up of capacity utilization of its Tyre manufacturing capacity, Balkrishna Ind is setting up a carbon black plant with capacity of 60,000 MT per annum in Bhuj (Gujarat). The plant is expected to commence operations in FY19.
• Apollo Tyre: The company will invest 20 billion on a greenfield PCR plant in AP in phase-I.
• CEAT: The Board has approved an additional investment of INR 706 Cr towards capacity expansion of greenfield project for passenger tyres. Aggregate amount to be invested increases to INR 3,506 Cr (up till FY22).

Thing that may threaten Tyre Industry are (1) higher Raw Material prices, and (2) higher Crude Oil prices

Disclaimer: The contents and data presented here are just for your information & personal use only. While much effort is made to provide the information, I ( Vishal Dalwadi ) or “Fin Blab” do not guarantee the accuracy, correctness, completeness or reliability of any information or data displayed herein and shall not be held responsible.

The post FINBLAB RESEARCH: Tyre Sector Q3 Numbers and Analysis appeared first on Upcoming ipos: Latest news on stocks, economy & finance.