MRF

Its continuing operations’ standalone net profit went down 32.2 per cent to 1.24 billion rupees (15.14 million dollar) for the quarter ending 30 September, as compared to 1.83 billion rupees a year earlier. Russia’s invasion of Ukraine and low demand due to soaring fuel costs raised the supply issues for raw materials

The Indian tyre manufacturer MRF Ltd missed its second-quarter profit estimates on 8 November. This came after the input costs soared and supply chain issues weighed, offsetting a surge in revenue.

Its continuing operations’ standalone net profit went down 32.2 per cent to 1.24 billion rupees (15.14 million dollar) for the quarter ending 30 September, as compared to 1.83 billion rupees a year earlier, it said during an exchange filing.

According to analysts, a profit of 1.85 billion rupees was expected. Due to the increasing global inflation, the tyre manufacturing industry has been dealing with higher input costs which led to hiked prices of raw materials like rubber.

In July this year, the chairman of MRF, K.M. Mammen had said Russia’s invasion of Ukraine and low demand due to soaring fuel costs raised the supply issues for raw materials. Also, it played spoilsport for the company and the entire industry at large.

In addition, due to the Russia-Ukraine conflict, a sharp surge was witnessed in petrochemical costs, a key component in tyre manufacturing. The input costs of MRF’s saw an 8.1 hike to 41.13 billion rupees.

Other Indian tyre companies along with MRF said that they foresee a 11 billion rupees investment for expansion of rubber plantations in India’s north-eastern and eastern regions.

Its revenue from operations surged 18.4 per cent to 57.19 billion rupees. MRF’s competitors CEAT and JK Tyre and Industries too recorded big slumps in their quarterly profits, during last week.