AgencyCeat delivered a strong earnings performance in FY2021 with revenue growth of 45% to 2,290 Net Profit of Rs. 153.3 crore and Net Profit of Rs. 15.3 crore.

RPG Group’s flagship company Ceat Ltd on Wednesday announced an investment of 120 in order to expand radial capacity in trucks and buses despite short-term disruptions caused by the second wave of the epidemic.

The new investments approved by the board are higher than the Rs 350 crore announced by the company a few years ago. Some of the investment will be in expanding the existing plant in Halol, Gujarat, and some will be in the Chennai brownfield plant-a base for automotive radial tires.

Goenka, managing director of Ceat Tires Anant, told The Economic Times that the Halol truck radial plant on the outskirts of Baroda is expected to be operational within a year and 18 New capacity is needed within a month. As a result, the company received approval from the board of directors.

“We have bigger ambitions, and certainly the growth in the market has provided us with continued good support, and with the board’s approval, we see a healthy growth rate and we are well positioned for the future.” Added.

The Rs 12 billion will be divided into two phases, of which about half will be utilized for current investments and the other half will be utilized post-listing as the company prepares for a Rs 10 billion capex in FY2022. It will be used for specific projects in the automotive radial, truck radial and specialty tire segments.

Ceat’s past capacity investments have enabled it to outperform the market over the last few years and the new investments will help the company maintain this growth momentum once the market recovers in the second half of the year.-22. said Geyinka.

Goenka said that while the company has started expanding aggressively, the company has not lost any financial efficiency. Last year, the company’s debt was reduced by Rs. 150 crore and the company’s debt to equity ratio has further improved.

Ceat delivered a strong earnings performance in FY2021, with revenues growing 45% to 2,290 Net profit of Rs 1,533 crore crore. However, the company’s EBIDTAA margin has declined to 11.7% due to deterioration in profitability as a result of the recent spike in raw material prices.

“In the second half of the year, gross margins declined marginally due to higher raw material prices, leading to a slight increase in prices, frequent shutdowns and high raw material prices remain a concern for the industry in terms of medium-term OEM and retail demand. This is why we need to remain optimistic,” added Gernka.

Goenka He said that looking ahead, demand was very strong until April 15 when factories started to open at 90% of capacity at 90% of prices, but the closure of factories and retail stores in the last 20-25 days has created a lot of uncertainty. Unlike the first wave, the second wave has also affected rural markets.

“Companies will readjust production as needed,” he added.