The company’s operating performance has also improved, with EBITDA rising 39% to Rs 503.7 crore from Rs 362.2 crore a year earlier. The consolidated EBITDA margin increased to 13.4% from 11% in the corresponding quarter last year. On a standalone basis, sales stood at Rs 3,701.1 crore, up 12.2% year-on-year, with EBITDA margin of 13.7% and net profit of Rs 202.2 crore.
Arnab Banerjee, MD and CEO, CEAT, said the company maintained strong double-digit growth during the quarter, helped by a reduction in GST rates on tires and vehicles, which is expected to support domestic demand. He also highlighted Camso’s full integration into CEAT in September, which marked a major milestone in the company’s global premiumization strategy. CEAT aims for double-digit growth in the second half of the year.
Domestic demand remained robust, supported by the rationalization of VAT. The Replacement (RE) segment recorded mid-single-digit growth in Q2 2026, although sales declined in the three weeks of September due to trade inventory cuts and purchase deferrals in the run-up to the new GST rates. The OEM segment posted strong mid-20% growth, driven by higher fitments in passenger cars with larger rim sizes.
By product category, PV tires grew at mid-single digits, two-wheelers saw strong growth on the back of positive sentiment in rural areas, agricultural tires grew in the mid-teens and truck and bus tires grew on a low base. CEAT also gained market share in motorcycles at selected accounts.
Looking ahead, the domestic tire market is expected to benefit from GST-driven demand, especially for value vehicles in rural and semi-urban areas. CEAT is likely to continue to post double-digit growth in the near term, supported by favorable GST rates, strong rural demand and premiumization trends. According to JM Financial, industrial demand in the RE segment is expected to grow in line with GDP for MHCVs (mid single digits), 7-8% for two-wheelers and 0 to low single digits for PVs, with potential benefits from GST rationalization. In the OEM segment, growth is expected from 0 to low single digits for MHCVs, 6-8% for PVs, and two-wheelers are expected to maintain healthy momentum, with a slight degree of moderation. JM Financial has downgraded the stock from Buy to Add, with a target price of Rs 4,050.(Disclaimer: Recommendations, suggestions, views and opinions expressed by the experts are their own. These do not represent the views of The Economic Times)
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