Falling raw material costs lift Tyre stocks; analysts expect margin recovery

Domestic brokerage firm Motilal Oswal Financial Services believes that moderation in raw material (RM) prices will boost the margin recovery of tyre manufacturers. WTI crude futures fell 8.09% to $73.77 a barrel. Brent crude futures dropped 8.56% to $78.56 a barrel.

MRF drops 7% after profit margins hit by high costs

MRF's overall expenses increased as a result of higher raw material prices, which reduced profit margins. During the second quarter, total expenses jumped by 21.86% to ₹5,345.7 crore, compared with ₹4,386.7 crore in the corresponding period last year.

Tyre stocks are on a bull run due to a surge in demand and drop in crude prices

In Thursday's trade, Apollo Tyres set a new 52-week high of ₹279.8 on the BSE. The stock gained 10.50% in the last week to ₹278.15 from ₹251.70. Similarly, Ceat's stock has increased 44 percent in the last three months. JK Tyre, on the other hand, increased 10.87 percent in the last week.

Kotak Securities downgrades 3 Major tyre stocks, citing high crude prices

Kotak Institutional Equities reduced its target price for some tyre stocks and stated that now is not the time to bottom-fish. The brokerage firm expects tyre companies' profitability to remain under pressure in FY23 due to a surge in crude oil prices.

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Falling raw material costs lift Tyre stocks; analysts expect margin recovery

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