Wealthova: CEAT Shares Surge 12% Following 145% Q4 Profit Jump to Rs 244 Crore—Is It Time to Invest?
On Wednesday, shares of CEAT experienced a significant surge of 12% following the company’s impressive financial results for the fourth quarter of FY26. The tyre manufacturer reported a consolidated net profit of Rs 243.85 crore, reflecting a remarkable 145% increase from Rs 99.5 crore during the same quarter in the previous financial year. Revenue from operations also saw a substantial rise of over 23% year-on-year, totaling Rs 4,219 crore compared to Rs 3,421 crore in Q4 of FY25. However, total expenses grew at a slightly more measured rate of 19% YoY, bringing it to nearly Rs 3,895 crore, and resulting in a healthy EBITDA margin of 14.18%.
In conjunction with the positive financial performance, CEAT announced a dividend of Rs 35 per equity share, subject to shareholder approval, marking an increase from the Rs 30 dividend paid in the previous two years. CEO and Managing Director Arnab Banerjee emphasized the firm’s robust growth across all segments, including international sales, despite prevailing geopolitical tensions. He also acknowledged short-term challenges related to supply chain and raw material costs, which the company aims to address through strategic pricing and cost management, while planning to expand capacities in alignment with growth objectives.
Market analysts, including Motilal Oswal, have maintained a ‘Buy’ rating on CEAT shares, citing a 23.3% growth in net sales, aligning with estimates driven by strong volume growth and improved realizations. The brokerage noted the company’s EBITDA margin exceeded expectations at 14%, benefiting from operational leverage. Although the stock has seen a slight decline of 2% over the past week, it has ascended over 7% in one month and 22% in one year, indicating strong long-term performance as CEAT has appreciated significantly—140% over three years and 173% over five years—resulting in a market capitalization of Rs 15,059 crore.
Source: The Economic Times
(Expert Note: This report was prepared by the Wealthova team.)