• Demand outlook: Following 20% growth in Q3 and 18.5% in Q4, demand remains strong entering Q1 across replacement and OEM segments. However, management expects overall demand growth to taper off across domestic and international markets as necessary price increases are implemented.
• Price hike plans: Raw material costs have increased by over 15% in Q1 compared to Q4, requiring a minimum 10% hike in finished goods pricing. CEAT has implemented a 5% replacement price hike through April with another 5% planned across May and June, alongside lagged indexation increases for OEMs.
• Margin pressures: The company aims for a 40% gross margin and an EBITDA margin of 14% to 15% on over 15,000 crore turnover, but anticipates margin contraction in Q1 due to high input costs and pricing lags.
• Camso integration: Completing the transition of direct customer handling and in-house compound manufacturing from Michelin will take four more quarters. Full operational control and accelerated margin expansion from the acquisition are expected to be visible in FY28.
• International sales target: Consolidated international saliency reached 23.5% with Camso, and CEAT aims to scale global revenue contribution to 30% to 35% over the next 4 to 5 years despite near-term Middle East disruptions.