Representation Photo

CEAT Ltd reported strong growth in the December quarter, supported by higher volumes, improving operating margins and continued investment in capacity expansion, while flagging near-term pressure from currency movement and raw material costs.

The tyre maker posted consolidated revenue of INR 41.57 billion for the third quarter of FY26, up about 26 percent year on year. Standalone revenue rose 20.1 percent to INR 39.57 billion, driven by growth across replacement, OEM and international markets.

“This was a good Q3 for us, with more than 20 per cent year-on-year growth on a standalone basis,” said Arnab Banerjee, Managing Director and Chief Executive Officer. “Volume momentum continued across segments, supported by GST rationalisation, improving consumer sentiment and steady recovery in OEM demand.”

Demand outlook remains supportive

Management said the Indian tyre market entered calendar 2025 on a stronger footing, aided by tax reforms, rising electric vehicle adoption and premiumisation. CEAT expects the industry to deliver healthy single-digit growth over the medium term.

“Increasing disposable income in rural markets following robust rabi sowing and kharif harvest completion has been supportive,” Banerjee said, adding that replacement demand for truck and bus radials is expected to remain in the mid-to-high single digits, with seasonal upside during the summer months.

Two-wheeler tyres continued to perform strongly, while OEM demand for medium and light commercial vehicles recovered following GST rationalisation. Passenger vehicle demand is expected to grow at double-digit rates in the near term, supported by easing financing conditions.

International demand for radial commercial vehicle and passenger car tyres remained firm, with India emerging as a credible sourcing base for global OEMs and distributors.

Margins improve despite cost headwinds

Standalone EBITDA rose to INR 5.56 billion, translating into a margin of 14.1 per cent. Consolidated EBITDA stood at INR 5.68 billion, with margins improving both sequentially and year on year.

Gross margins, however, contracted sequentially by about 109 basis points, largely due to currency depreciation and inventory adjustments.

“The depreciation of the rupee and a modest rise in international natural rubber prices could result in a 1 to 1.5 per cent cost headwind over the next few quarters,” said Kumar Subbiah, Chief Financial Officer. “While crude-linked inputs remain stable, currency remains the key variable to watch.”

Standalone profit after tax came in at INR 1.92 billion, compared with INR 2.02 billion in the previous quarter. The decline reflected a one-time provision of INR 578 million linked to new labour code implementation.

“This provision largely relates to past service costs,” Subbiah said. “The ongoing quarterly impact going forward is expected to be minimal.”

Camso integration on track

CEAT said the integration of its Camso off-highway tyre business is progressing broadly as planned. Quarterly revenue stood at about USD 20 million, reflecting the ongoing transition of customer relationships from Michelin to CEAT.

“Most existing customers have approved the business transfer, ensuring continuity,” Banerjee said. “There are some one-time transition and IT costs in Q3, which will not recur from Q4 onwards.”

Management said underlying operating margins at Camso are already in double digits and are expected to improve further as utilisation rises and CEAT gains greater control over sourcing and sales.

Capex remains elevated

Capital expenditure during the quarter stood at INR 2.54 billion, taking cumulative spend for the year to INR 6.73 billion, excluding acquisition-related intangibles.

The board approved an additional INR 13.14 billion investment at the Chennai plant to add 3.5 million passenger car tyres of annual capacity, with completion targeted for the second half of FY28. The project will be funded through a mix of internal accruals and debt.

“Our capex guidance remains broadly in line with earlier estimates,” Subbiah said. “We will continue to monitor leverage closely to ensure balance sheet strength.”

Standalone gross debt stood at INR 29.54 billion, with debt-to-EBITDA improving to 1.25 times.

EV, premiumisation and sustainability

CEAT maintained a strong position in electric vehicle tyres, with more than 30 per cent share in OEM passenger EV tyres and about 20 per cent in two-wheeler EVs. The company continues to invest in premium products, including larger rim-size, run-flat and ZR-rated tyres, to improve realisations.

On sustainability, CEAT announced a partnership with CleanMax to develop 59 MW of hybrid wind-solar capacity, targeting about 60 per cent renewable energy usage by FY27.

“Q3 closed on a strong note, supported by a robust product pipeline and improving customer confidence,” Banerjee said. “We remain focused on sustaining growth while maintaining margin discipline and investing for the long term.”

Nexen Tire has received a ‘Good’ overall rating for its N'Fera Sport model in the latest summer tyre test conducted by Auto Bild in March 2026. The assessment highlights the tyre's strong performance within the competitive Ultra-High-Performance segment.

Tested on a BMW 5 Series (G60) with size 245/45 R 19 tyres, the N'Fera Sport distinguished itself through exceptional braking capabilities, achieving the third-shortest stopping distance among 50 competitors in the qualification phase and demonstrating excellent safety margins on both wet and dry surfaces. The tyre further impressed with its precise steering response and reliable grip, even under challenging conditions. Its overall performance secured it the third-place position in the qualification round. Notably, the N'Fera Sport also excelled in acoustic comfort, ranking second out of 20 tyres for low noise generation.

These results underscore the model's blend of control, responsiveness and safety, making it suitable for both everyday driving and more dynamic scenarios. Nexen Tire views this recognition as a validation of its ongoing commitment to innovation, quality and the production of high-performance products designed to enhance the driving experience.

Bridgestone Corporation has unveiled its comprehensive motorsports engagement strategy for 2026, reaffirming its dedication to competitions spanning all levels, from elite international championships to grassroots events for amateur enthusiasts. This initiative will prominently feature the POTENZA brand for four-wheel racing and the BATTLAX brand for two-wheel competitions, operating under the core philosophy that tyres are essential to safeguarding life.

In the realm of premier racing, the company supplies tyres under both the Bridgestone and Firestone banners. The Bridgestone brand continues its dominant presence in Japan's premier SUPER GT series, where POTENZA-equipped teams recently secured an unprecedented fifth overall championship title in both the GT500 and GT300 categories. Simultaneously, on two wheels, BATTLAX-equipped competitors have achieved their fifth consecutive victory – and sixth overall – in the gruelling FIM Endurance World Championship, underscoring the tyre technology's reliability and performance under extreme conditions.

Complementing these achievements, the historic Firestone brand upholds its 125-year legacy as the exclusive tyre supplier for the renowned NTT INDYCAR SERIES. This partnership includes providing tyres for the legendary INDY500, ensuring the continuation of this exhilarating motorsport tradition. Through these diverse activities, the technologies honed from the racetrack directly contribute to the evolution of its consumer product lines, strengthening the Bridgestone brand and bringing new innovations to customers worldwide.

The company prioritises competitor safety and confidence by supplying tyres meticulously developed and proven on the racetrack, thereby actively nurturing the broader motorsports culture. Crucially, the high-stakes environment of racing serves as a mobile laboratory, where technological advancements forged in the pursuit of victory are transferred to enhance consumer and commercial tyres, reinforcing the brand's commitment to delivering superior value.

Hiroshi Imai, Vice President and Senior Officer, Global Motorsports Bridgestone Corporation, said, “Motorsports is the ultimate team sport. Everyone involved will come together as 'One Team’, embracing the challenge of motorsports with passion and supplying tyres we have poured our hearts and souls into. We hope to bring joy to drivers, riders, teams and all the fans who come to witness the thrill of racing. I feel as if I'm rolling along with our tyres on the track! This year, we are also sharing the voices of 10 of our teammates who work in motorsports tyre structural design, material development, production and motorsports operations. Please look forward to the efforts of our dedicated teammates who face tyres every day, and their passion through ‘Genbutsu-Genba’ to pursue the ultimate in tyre performance.”

CEAT Limited recently organised a specialised engagement initiative for women fleet owners at its manufacturing complex in Chennai. The programme aimed to foster professional dialogue and knowledge sharing while providing an in-depth look at the intricacies of tyre production and development. Attendees, who came from diverse regions across the country, toured the company’s advanced Chennai facility, which holds a 'World Economic Forum Lighthouse' designation. During the visit, they witnessed key production stages, engaged with technical experts and learned about the quality control, safety protocols and innovative practices integral to CEAT's operations.

This effort brought together 14 women transporters representing various roles and business sizes within the logistics sector, collectively contributing decades of industry experience. The gathering was arranged in collaboration with the Women’s Wing of the All India Transporters Welfare Association (AITWA), with participants hailing from major cities such as Mumbai, Delhi, Kolkata and Chennai. The initiative was supported by Reema Kothari Jogani, Chairperson of the AITWA Women’s Wing.

While women still form a modest segment of India's transport workforce, their involvement has been steadily rising. This trend is significant in the context of the country's broader economic ambitions, including the Viksit Bharat 2047 vision and the goal of a USD 30 trillion economy, where women-led development is seen as a key driver. The logistics industry itself is projected to grow substantially from its 2024 valuation of USD 354 billion to USD 800 billion by 2030.

CEAT is actively working to increase female participation, particularly in manufacturing. Through automation, ergonomic enhancements and lift-assist systems, the company has made physically demanding roles more accessible. These measures have resulted in women comprising 20 percent of the workforce at the Chennai plant. Furthermore, the Nagpur facility, which was the first in Maharashtra to permit night shifts for women, has achieved 28 percent female representation on its shop floor. The company’s focus extends beyond numbers to creating an environment where women are encouraged to lead and excel in roles that have been traditionally male-dominated.

Vishal Pawar, Senior Vice President – Global Sales and Supply Chain, CEAT, said, “Women fleet owners are playing a pivotal role in redefining the boundaries of the transport sector. Their determination and entrepreneurial spirit inspire us. At CEAT, we are proud to create meaningful avenues for them to engage with the industry, build networks and gain deeper exposure to manufacturing and technology. We remain committed to supporting their journey of growth and empowerment.”

Reema Kothari Jogani said, “Building an inclusive logistics ecosystem requires collaboration between industry stakeholders, organisations and entrepreneurs. CEAT’s initiative is a constructive step towards strengthening this ecosystem by enabling women fleet owners to interact with experts, learn from best practices and explore the operational depth of modern manufacturing. These are women who not only run and grow their businesses together but also share a strong sense of camaraderie supporting each other and finding moments of fun along the way. Such engagements help accelerate the participation of women in a traditionally male dominated sector and contribute to long term industry transformation.”

The ongoing conflict in West Asia presents serious challenges for India’s tyre industry, according to the Automotive Tyre Manufacturers Association (ATMA), which has called on the government to introduce policy measures to ease the emerging pressures. In a recent submission, ATMA detailed how the geopolitical turmoil is likely to disrupt export activity, drive up raw material prices and strain the sector’s supply chain.

India sends tyres worth an estimated USD 250–260 million to West Asia each year, a trade flow now at risk. The situation is further complicated by potential blockages or delays in strategic maritime passages like the Strait of Hormuz and the Suez Canal, which could slow shipments to Europe, United States and Africa while pushing freight costs higher.

Soaring crude oil prices, currently around USD 100 per barrel, are compounding the problem. Given that crude derivatives account for 60 to 70 percent of the materials used in tyre production, inputs such as synthetic rubber, carbon black and processing oils are becoming significantly more expensive. Import-reliant segments of the supply chain, including natural rubber, chemicals and tyre cord fabrics, are also feeling the strain from disrupted global shipping routes.

ATMA has proposed a range of government interventions to help the industry navigate these headwinds. These include reinstating previous RoDTEP rates, improving Duty Drawback benefits and correcting the inverted duty structure affecting tyres and natural rubber. Easing import restrictions on natural rubber – such as lifting port limitations, removing pre-import conditions and extending the export obligation period to 18 months – has also been suggested. In addition, the association recommends lowering or removing customs duties on other raw materials that are either in short supply domestically or not produced locally.

To maintain continuity in production, ATMA has urged that the tyre industry and its Tier-1 suppliers be classified as ‘Essential’ services. This designation would help secure a steady supply of natural gas and LPG, both vital for manufacturing. Any disruption, the association warns, could ripple through sectors reliant on mobility, including logistics, agriculture and public health services. ATMA remains hopeful that timely government support will preserve the stability and global competitiveness of India’s tyre sector.

Arun Mammen, Chairman, ATMA, said, “For the Indian tyre industry, the combined impact of rising input costs, freight disruptions and export uncertainties could affect competitiveness in international markets. At a time when India is focused on strengthening its export momentum, it is important that the industry receives timely policy support to navigate these challenges."