New Delhi Jul 21 :- Tyre maker CEAT on Wednesday reported a 61 per cent decline in its consolidated net profit at Rs 9 crore for the June quarter as high raw material prices impacted business.
The Mumbai-headquartered company had posted a net profit of Rs 23 crore in the corresponding period of last year.
Revenue from operations, however, rose to Rs 2,818 crore in the first quarter as against Rs 1,906 crore in the year-ago period, the company said in a regulatory filing.
“We witnessed a strong topline growth during the quarter, aided by robust momentum in OEM and replacement segments. We continued to ramp up our capacities as demand picked up across categories. However, the continued spike in commodity prices has impacted gross margins, which was partially offset by price adjustments over the last quarter,” CEAT Ltd MD Anant Goenka said.
Elaborating further, CEAT CFO Kumar Subbiah noted that the company continued to keep tight control on cash flows and costs during the quarter.
“Despite a capex of Rs 250 crore, we have maintained our net debt level close to the previous quarter. Raw material costs moved up during this period, impacting our margins adversely,” he added.
However, there has been some correction in the commodity prices recently and if the trend continues, it will bear a positive impact on the business, Subbiah stated.
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