Dolat Capital Market's research report on CEAT
CEAT reported stellar topline in Q4FY21 while EBITDA margin was suppressed on account of high RM cost (GM contracted by 355bps QoQ) and adverse mix. Overall raw material cost increased by about 12% sequentially on a per kg basis. Consol revenue grew 3% QoQ to Rs 22.9bn (vs est Rs 22bn) in 4Q led by 1) revival in OEM demand and capacity addition, 2) continued strong replacement demand and 3) market share gain in PCR and TBR segments.
Outlook
However, rising RM inflation and weakening retail are key near term risks. We maintain Accumulate rating with TP of Rs 1,456 (based on 14x FY23E Cons EPS).
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