The standalone revenue for Q1FY22 stood at Rs. 4,128 crores, a growth of 70% YoY. The revenue declined by (-12.9%) on QoQ basis.
Operating profit stood at Rs. 580 crores. The operating profit increased by 54.7% YoY and suffered a decline of (-27.7%).
The operating margins in Q1FY22 were 14%, a decline of (-100) bps when compared to operating profit margin of 15% during Q1FY21. The operating margins were down by (-300) bps on QoQ basis.
Profit before tax stood at Rs. 217 crores, posting a growth of almost 6.7x due to lower base effect. The same PBT declined by (-49.7) QoQ.
The company registered a PAT of Rs. 161 crores. The PAT suffered a decline of (-49.2%) when compared to Q4FY21 PAT of Rs. 317 crores. PAT has shown a huge percentage increase when compared on YoY basis mostly due to a very low base during Q1FY21.
Consolidated Q1FY22 results
The consolidated revenue for Q1FY22 stood at Rs. 4,184 crores, a growth of 70% YoY. The revenue declined by (-13.1%) on QoQ basis.
Operating profit stood at Rs. 588 crores. The operating profit increased by 56.4% YoY and suffered a decline of (-28.6%).
The operating margins in Q1FY22 were 14%, a decline of (-100) bps when compared to operating profit margin of 15% during Q1FY21. The operating margins were down by (-300) bps on QoQ basis. The company restricted its decline of margins when compared with its peers with sharp change in finished goods inventory.
Profit before tax stood at Rs. 222 crores, increasing nearly 7 times when compared to PBT of Q1FY21 and a declining by (-50.6%) on QoQ basis.
The company registered a PAT of Rs. 166 crores. The PAT suffered a decline of (-50%) when compared to Q4FY21 PAT of Rs. 332 crores. PAT has shown a huge percentage increase when compared on YoY basis mostly due to a very low base during Q1FY21.
Low interest cost and higher other income has restricted the decline of PAT to 50%.
Business Highlights
The Q1FY22 performance of the company was majorly impacted due to rise in RM prices and operating deleverage.
The pricing environment of the industry is stable as all the players have been taking price increases to offset the rise in raw material costs.
RM cost as percentage of sales is highest at 62.1% in previous 5 quarters.
This has resulted in lowest gross margins operating margins for Q1FY22 when compared to past 5 quarters.
The gross margin trend is stable for the company when compared to its peers.
The company with its strong brand enjoys market share leadership in 2W, TBB and Agriculture tyres segments. This gives MRF pricing power resulting into high profitability and superior ratios.
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