CEAT Suffers A Consolidated Net Loss Of Rs 20 crore In Q3
Published On 24-Jan-2022
Soaring input costs are one of the prime reasons behind the dip.
Due to a slump in demand from the market leading to a weaker performance in Q3 of FY 2021-2022, CEAT has suffered a consolidated net loss of Rs 20 crore in the duration.
This performance from CEAT is not so encouraging, compared to the net profit of Rs 132 crore, which was posted during the Q3 of the financial year 2020-21. In addition, the total earnings before the taxes, depreciation and amortization also fell by 50 per cent to Rs 134 crore.
CEAT has stated that the increase of almost 24 per cent in the costs of input material has eaten up the net profits of the company. It has been confirmed by Anant Goenka, Managing Director, CEAT tyres. To ensure that the company doesn’t suffer much from the losses due to inflation, Goenka said that CEAT will be increasing the prices of all of its tyres over the next two quarters. He also commented that the pressure on maintaining the profit margin is expected to continue in the ongoing quarter, i.e. last one for FY 2021-2022.
While the demand for tyres for cars and two-wheelers was pretty decent, that for commercial vehicles, mainly trucks, had fallen drastically during the quarter. In addition, compared to the demand from automakers, which was muted in the duration, the international business from CEAT fared well.
However, all is not gloomy at CEAT, as the tyre maker has recorded a growth of 9 per cent in the year-on-year consolidated revenue, which stood at Rs 2,413 crore. Currently, the majority of CEAT’s revenue, which stands at almost 66 per cent, comes from the replacement market.
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