MRF Limited, one of India’s leading tyre manufacturers, has reported a mixed performance in the first quarter of FY26, with strong revenue growth but a notable dip in profitability. The company’s results for the quarter ended 30th June 2025 show consolidated revenue rising 6.66% YoY to ₹7,675.69 crore, but profit after tax (PAT) falling 12.36% YoY to ₹500.47 crore.
The figures indicate that while MRF maintained strong demand momentum in the automotive and replacement tyre markets, cost pressures—likely due to raw material inflation and competitive pricing—impacted margins.
Consolidated Financial Performance
| Particulars | Q1 FY26 (₹ Cr) | Q1 FY25 (₹ Cr) | YoY Change |
|---|---|---|---|
| Revenue from Operations | 7,675.69 | 7,196.45 | +6.66% |
| Profit Before Tax (PBT) | 1,197.67 | 1,243.66 | -3.70% |
| Profit After Tax (PAT) | 500.47 | 571.02 | -12.36% |
| Net Profit Margin (%) | 6.52% | 7.93% | -1.41 pp |
MRF achieved solid sales growth, but net profit margin contracted by 141 basis points, reflecting higher input costs.
Standalone Financial Performance
| Particulars | Q1 FY26 (₹ Cr) | Q1 FY25 (₹ Cr) | YoY Change |
|---|---|---|---|
| Revenue from Operations | 7,560.28 | 7,077.84 | +6.82% |
| Profit Before Tax (PBT) | 1,159.84 | 1,220.56 | -4.97% |
| Profit After Tax (PAT) | 484.23 | 562.55 | -13.92% |
| Net Profit Margin (%) | 6.40% | 7.94% | -1.54 pp |
The standalone performance closely mirrors consolidated figures, indicating broad-based trends across the company’s operations.
Key Highlights of Q1 FY26
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Revenue Growth: Consolidated sales rose 6.66% YoY, driven by sustained demand in the OEM and replacement tyre segments.
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Profit Decline: Consolidated PAT fell 12.36% YoY, highlighting pressure on margins despite volume growth.
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Standalone Trend: Standalone PAT declined 13.92%, reflecting similar cost challenges as in the consolidated results.
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Margins Under Pressure: Net margins slipped due to higher raw material costs, logistics expenses, and a competitive pricing environment.
MRF Share Price Performance
| Date | Opening Price (₹) | Current Price (₹) | Change |
|---|---|---|---|
| 12 Aug 2025 | 1,42,000.00 | 1,41,170.00 | -0.58% |
Historical Returns:
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1-Year: +2.82%
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5-Year: +129.75%
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Max: +7,327.50%
While short-term returns have been modest, MRF’s long-term performance remains a testament to its leadership in the tyre industry.
Operational Analysis
The Q1 FY26 results point to steady demand but rising cost pressures. The revenue growth of 6.66% is healthy, especially in a competitive automotive component industry, but profit contraction shows the impact of commodity price volatility—particularly rubber and crude-derived raw materials—on the bottom line.
MRF’s focus on capacity expansion, premium tyre segment growth, and aftermarket penetration remains key to sustaining its market leadership.
Industry Context
The tyre industry is experiencing mixed signals in 2025:
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Positives: Steady growth in passenger and commercial vehicle sales, government push on infrastructure, and robust replacement market demand.
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Negatives: Volatile raw material prices, increased competition from domestic and global players, and currency fluctuations impacting import costs.
Peer Comparison (Q1 FY26)
| Company | Revenue (₹ Cr) | PAT (₹ Cr) | YoY PAT Growth (%) | Net Margin (%) |
|---|---|---|---|---|
| MRF | 7,675.69 | 500.47 | -12.36% | 6.52% |
| CEAT | 3,020.00 | 180.00 | +5.88% | 5.96% |
| Apollo Tyres | 5,420.00 | 350.00 | -3.25% | 6.46% |
MRF leads in revenue scale but faced sharper profit decline than some peers, underlining the need for cost optimization.
Outlook for FY26
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Growth Drivers: Expanding demand for premium tyres, increasing OEM partnerships, and robust rural market consumption.
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Challenges: Volatile input costs, competitive pricing pressures, and slowing export markets.
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Focus Areas: Strengthening supply chain, cost management, and leveraging brand strength for premium segment expansion.
Conclusion
The MRF Q1 FY26 results show that the company is holding its ground in terms of sales growth but is grappling with profitability headwinds. With revenue up 6.66% and profit down 12.36%, the challenge ahead lies in controlling costs while sustaining growth momentum.
Given its strong brand equity, leadership in the tyre market, and history of long-term wealth creation, MRF remains a key player to watch, though short-term margin pressures may persist.
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