MRF Shares Rise 4% as Q4 FY25 Revenue Hits ₹6,944 Crore

MRF raced ahead in the stock market on 7 May, rolling out a strong Q4 performance that increased its shares by 4%. The share price of one of India’s most expensive stocks by value touched a high of ₹1,41,500 on the NSE, after opening at ₹1,31,500, reflecting a gain of over ₹10,000 per share in just one day. It finally closed at ₹1,40,420, a ₹5,430 surge over the previous closing. In the past month, the stock has climbed nearly 28%, adding more than ₹30,000 per share to its value. The spike was witnessed after the tyre giant reported a 31% year-on-year jump in net profit for the March 31, 2025, quarter. 

The company reported consolidated revenue of ₹6,944 crore, an increase from ₹6,316 crore in the same period last year. Rising demand in both OEM and replacement tyre markets supported this growth. This solid growth in revenue and profit for the country’s iconic tire brand reflects improved demand, better cost control, and a resilient market outlook. 

Source: Economic Times, Money Control

Profit Jumps as Operational Strength Shines

MRF’s net profit rose to ₹493 crore in Q4, showing a 33% increase compared to ₹370 crore a year ago. Better cost control, increased volumes, and improved product mix across categories drove this sharp growth. Its EBITDA also rose by 18% to ₹1,043 crore in the March quarter. The EBITDA margin improved to 15%, reflecting stronger operating efficiency.

The company announced a final dividend of ₹229 per equity share, equalling 2290% on the face value of Rs 10. Including previous payouts, the total dividend for FY25 stood at ₹369 per share, continuing MRF’s long-standing tradition of rewarding its shareholders. The company had earlier declared and paid two interim dividends of ₹3 per share each for the March 31, 2025, financial year. With the final dividend, the total payout for the year amounts to ₹235 per share.

Despite the sizable dividend payout, MRF’s dividend yield stays relatively low at just 0.15%, considering its current stock price of approximately ₹1,40,000. Source: Business Today, Economic Times

However, although Q4 numbers were robust, the full-year net profit came in at ₹1,939 crore, slightly lower than last year’s ₹2,025 crore. The dip reflects earlier pressure from high raw material costs and a mixed global demand environment. Source: Business Standard

Reasons for MRF’s Solid Performance

Multiple strategic and operational factors drive the performance in MRF’s Q4 FY25 results. Here’s a breakdown of the key contributors to this success:

1. Tyre Demand on the Rise as Auto Sector Recovers

The broader tyre industry is gaining momentum, thanks to a revival in automobile sales and increased infrastructure activity. MRF’s substantial brand equity and vast distribution network helped it capitalise on this demand.

2. Efficiency Measures Drive Margin Growth

MRF’s management attributed the improved margins to stringent cost control and enhanced internal efficiencies. The softening of raw material prices further supported this margin expansion.

3. Steady Gains from Global Footprint

Despite global market uncertainties, MRF’s presence in key export regions provided stability. The company is cautiously expanding its international operations to maintain balance and mitigate risks.

4. Product Diversification and New Launches

The introduction of new stock-keeping units (SKUs) across various product categories, including passenger, motorcycle, truck, light commercial vehicle (LCV), and off-the-road (OTR) tyres, contributed to the company’s growth momentum during the year.

5. Strategic Price Adjustments

MRF implemented price hikes during the year to counteract rising input costs. These strategic adjustments helped offset increased raw material expenses and rupee depreciation.

6. Strong Performance Across Market Segments

The company’s growth was driven by all three key market segments: replacement, institutional, and export. This diversified performance underscores MRF’s robust market presence and adaptability.

The Road Ahead: Cautious Optimism

MRF’s strong Q4 performance has created optimism, but the company still faces challenges. The tyre industry is expected to grow further, supported by rising vehicle sales, better roads, and higher replacement demand. These trends should help MRF continue on a steady path.

However, there are areas to watch out for. Competition is increasing, and low-cost tyre imports could affect market share. Fluctuating raw material prices—especially rubber and oil-based products—may also impact profit margins. On the global front, export demand remains uncertain, even though MRF is slowly expanding its presence overseas.

Despite these factors, MRF’s ability to manage costs, launch new products, and maintain strong dealer relationships puts it in a good position. Its trusted brand name and stable performance make it a reliable player in the long run.

Conclusion

MRF ended FY25 on a high note, backed by a rise in revenue, profit, and margins, which shows that the company has used its strengths well during tough times. While some risks remain, MRF’s focus on efficiency, steady demand, and shareholder value gives it a strong base for future growth.

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