• Margin recovery: Raw materials rose about 23, 24% from exit March prices by the end of Q2, leaving gross margin hovering around 33.5 odd percent; reaching 40, 41% requires making up about 6.5, 7%. Management expects a 2.5 to 3% raw-material hike in Q3 versus Q2 actuals, so pressure will continue, with frequent price increases planned across replacement, OE and international markets.
• Demand outlook: Q2 volumes held up, and management expects double-digit growth in Q3 and Q4, though growth may moderate from H1’s 20% plus pace due to price hikes and a higher base. Growth is strong in off-highway, 2-wheeler and commercial-vehicle tires, while 4-wheeler tire growth is at low single-digit.
• Capex and debt: Q2 capex was about 480 odd crore, with full-year capex expected around ₹1,400 crore as factories run at 90% plus utilization. Debt has risen by about ₹400 crore; management will focus on ratios rather than a ₹3,000 crore debt target, citing debt-equity of about 0.77 odd and debt-EBITDA below 2, versus internal control limits of 3.
• CAMSO contribution: CAMSO is near EBITDA neutrality or slight EBITDA positivity, with management aiming to maintain that in the second half. Gross margin visibility is 55 to 60%; as factory utilization rises from sub-50 level to at least 60, 70% level, it expects CAMSO to become EPS-accretive around the full year of FY29.