CEAT suffered a big blow in the first quarter! Profit decreased by 96%, there was selling in the stock market.

Ceat Share Price Downfall: Shares of tire maker CEAT slipped more than 9 percent in the morning session on Friday. The reason for this is the company presenting weak results in the June 27 quarter of the financial year due to high operating costs. With the opening of the market, CEAT shares slipped 9.3 percent to Rs 3,471.10 in early trade as against the previous closing of Rs 3,829.60. However, at 10:47 am it was at Rs 3,548 with a weakness of 7.33 per cent.

The company recorded a huge decline of 96 percent year-on-year in consolidated net profit in the first quarter of financial year 2026-27. The company’s profit declined to Rs 4 crore, which was Rs 112 crore in the same quarter of the last financial year. However, revenue from operations increased 22.4 per cent year-on-year to Rs 4,318 crore from Rs 3,529 crore in the same period last year. This reflects strong demand across various business sectors.

What did the company say about profits?

According to the company, Ongoing conflict in West Asia Due to increase in the cost of raw materials, there was pressure on its profits. The company’s managing director (MD) and chief executive officer (CEO) Arnab Banerjee said the company increased tire prices in a phased manner to partially offset the impact of increase in input costs, while also maintaining demand and market share. He said that raw material prices are likely to remain at high levels during the second quarter also.

Share fell by 8% in six months

The company’s operating performance also remained under pressure. Ebitda declined 5.7 percent year-on-year to Rs 365 crore from Rs 387 crore a year ago. At the same time, Ebitda margin declined to 8.5 percent, which was 11 percent in the same period last year. CEAT shares have fallen about 8 per cent in the last one year, underperforming the broader market. The stock is down more than 8 percent in the last six months and nearly 6 percent so far this year.

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Expert opinion regarding shares

Motilal Oswal Financial Services has given a rating of BUY to the company’s shares. The brokerage firm also said that the company’s earnings in the first quarter of fiscal year 2027 may be slightly lower than expected. He attributed this to the rapid increase in interest.