CEAT Q2 FY27: Consol PAT down 40% YoY to ₹112 Cr as margins compress, VRS charge weighs

CEAT's consolidated PAT fell 40% YoY to ₹112 Cr (from ₹185.7 Cr) even as revenue grew 26.2% YoY to ₹4,762 Cr, with EBITDA margin (OPM) compressing to 9.5% from 13.5% and net margin to 2.4% from 4.9% a year ago. The YoY revenue comparison is not fully like-for-like: this is the first year-on-year quarter carrying CEAT OHT's Camso off-highway business, consolidated only from September 2025, so part of the topline gain is inorganic. Sequentially, revenue rose 10.3% QoQ and PAT jumped off an unusually depressed ₹4 Cr Q1 FY27 base — a base effect from an abnormal Q1 tax charge, not a real sequential turnaround, so the QoQ PAT swing should not be read as a trend.

The quarter carried a ₹13 Cr exceptional VRS charge (nil in the year-ago quarter); adjusting for it, PAT was closer to ₹121 Cr, trimming the YoY decline to roughly 35% from the 40% reported — still a clear decline, not just an accounting artefact. Standalone PAT, CEAT's core India business, fell a milder 18.8% YoY to ₹164 Cr (revenue +22.9% YoY to ₹4,548 Cr), versus the 39.7% consolidated drop — the gap stems from subsidiaries/JVs, where the group's joint-venture share swung to a ₹5 Cr loss from an ₹8 Cr profit a year ago, and the drag from subsidiaries on group profit widened to ₹47 Cr this quarter from ₹24 Cr YoY, consistent with the Camso-led international build-out.

The stock went into the print at ₹3,357.9, up 2.2% over the past month of trading.

For context: revenue is at a 6-quarter high.

No specific consensus PAT estimate for this quarter was found; pre-result brokerage notes flagged an expected 8-10% QoQ rise in the raw-material basket pressuring Q2 margins — OPM did improve QoQ (8.6%→9.5%) despite that, though it remains well below year-ago levels. Against management's own prior guidance from the Q1 FY27 call — that Q2 margin pressure would persist and CAMSO revenue benefits would be deferred to H2 FY27 — the quarter tracked in line: margins stayed compressed YoY, and the press release attributes growth to premium-segment momentum and price hikes rather than CAMSO synergies, which management still expects in H2. CFO Kumar Subbiah said commodity costs stayed elevated on the West Asia conflict and that debt rose due to ~₹490 Cr of capex and dividend payouts; MD Arnab Banerjee pointed to the 26% YoY revenue print built on premium-segment growth across business units despite the cost headwinds. This quarter's corporate actions — converting a $24.5 million loan to equity in the Sri Lanka subsidiary (CEAT OHT Lanka) and a further ₹4.6 Cr investment in Tyresnmore — extend the international/Camso-adjacent expansion that is weighing on near-term consolidated profit.