MRF Faces Margin Pressure Amid Rising Costs
· Business · LiveMint, Bloomberg
Tyre manufacturer MRF is experiencing margin pressure in FY27 due to significant raw-material cost inflation and lagging price hikes. In the June quarter, the company's adjusted profit after tax fell 2% to ₹474.37 crore, while EBITDA declined 8% year-on-year to ₹948.6 crore. Although revenue rose 10% to ₹8,291.56 crore, the company failed to fully offset a 570 basis point sequential dip in gross margins. Management attributed the cost inflation to supply-chain disruptions and conflicts in the Middle East. Analysts warn that MRF's modest price increases leave it more vulnerable to further input cost spikes than industry peers like Ceat and Apollo Tyres.
Why it matters
The company's inability to fully pass on rising costs to consumers threatens its profitability and may lead to continued earnings misses for shareholders.
Read the original report — LiveMint
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