India's MRF Reports Q3 Profit Jump On Softer Raw Material Prices, Solid Demand

Indian tyremaker MRF reported a 16% jump in quarterly profit on Thursday, as raw material prices eased and a pickup in economic activity led to higher demand for its now-pricier tyres. Standalone profit from continuing operations was 1.69 billion rupees ($20.46 million) for the third quarter ended Dec. 31, according to an exchange filing. MRF's total expenses rose 14% to 53.81 billion rupees, nearly half of the increase in the first six months of the current fiscal year.

Revenue from operations rose about 15% to 55.35 billion rupees.

Profits at tyremakers have climbed as raw material prices pulled back from Russia-Ukraine war-induced highs. They also benefited from tyre price increases that were implemented last year to cushion the hit from a surge in rubber prices.

MRF's rivals Apollo Tyres and JK Tyre & Industries also reported upbeat quarterly earnings earlier this month.

Demand from carmakers has improved as affluent Indians continue to buy big-ticket products, despite high inflation, while a rebound in economic activity led to higher sales from end-users.

India's top automakers, such as Maruti Suzuki India and Tata Motors, reported a double-digit rise in sales of commercial vehicles and utility vehicles in January, after posting solid profits for the October-December quarter.

MRF also reappointed Arun Mammen as its managing director for five years with effect April 1. Mammen, 57, has been on the MRF board since 1990 and became MD in 2004.

The company, which started as a toy balloon manufacturing business a year before India's independence, also declared an interim dividend of three rupees per share, unchanged from the previous quarter.