Ceat (500878) Q2 25/26 earnings summary

Executive summary

• Q2 FY26 consolidated revenue reached Rs. 3,773 crore, up 14.2% year-over-year, driven by strong OEM and international business growth, with net profit at Rs. 185.7 crore.

• EBITDA margin improved to 13.5%, supported by lower raw material costs and improved realizations.

• Camso acquisition completed and fully integrated, advancing the premium OHT segment and global premiumisation strategy.

• Launched India's first passenger car tyre with up to 90% sustainable materials and received multiple ESG recognitions.

• Indian car market benefited from GST rate cuts, favorable monsoons, and stable interest rates, boosting demand.

Financial highlights

• Gross margin expanded to 40.9% in Q2 FY26, up over 400 bps YoY.

• Standalone EBITDA margin at 13.7%; consolidated EBITDA margin at 13.5%, up 250+ bps YoY.

• Standalone net profit was Rs. 202.2 crore; consolidated profit at Rs. 185.7 crore, up from Rs. 121.5 crore YoY.

• EBITDA for Q2 FY26 was Rs. 510.6 crore, up 38.8% YoY.

• Overall volume growth for the quarter exceeded 11%.

Outlook and guidance

• Double-digit growth momentum expected to continue, supported by GST reductions and strong demand.

• OEM volume growth expected to continue, aided by festive inventory demand.

• Raw material costs expected to remain flat in Q3, with some impact from rupee depreciation.

• Full integration and value chain control of Camso expected in 5-6 quarters.