MRF profits up 57%
Although India’s Automotive Tyre Manufacturers Association recently expressed a measure of dissatisfaction about the domestic rubber situation, member company MRF Ltd’s latest quarter results show profits that have been helped by the commodity. In the three months between 1 April and 30 June (the third quarter of MRF’s financial year), the tyre maker’s net profit leapt 57.2 per cent to Rs 2.27 billion (£25.0 million).
Rubber prices in India declined throughout 2012 and began rising again at the start of this year. MRF took advantage of these lower prices and this can be seen in its margin, which grew year-on-year from 10.8 per cent to 15.8 per cent. The margin was also helped by MRF’s high level of replacement market activity in a country where sales of new vehicles are slowing; three quarters of MRF sales are made in the replacement segment.
Net sales for the April to June quarter came to Rs 30.5 billion (£336.6 million) during the quarter, approximately the same as a year earlier.