MRF Q2 Profit Falls 23% To ₹417 Crore, Rising Raw Material Costs Overshadow Strong Revenue Growth

New Delhi: Tyre manufacturer MRF Ltd reported a 22.8% decline in consolidated net profit to Rs 417.19 crore for the July-September quarter of FY27, as rising raw material costs weighed on profitability despite strong sales growth.

The Chennai-based company's net profit stood at Rs 540.13 crore in the corresponding quarter last year, according to its exchange filing.

Revenue from operations increased 17.4% to Rs 8,660.19 crore from Rs 7,378.72 crore in Q2 FY26, supported by sustained demand across vehicle manufacturers and replacement markets.

Raw Material Costs Surge

MRF's total expenses rose 21.8% to Rs 8,269.77 crore during the quarter, compared with Rs 6,788.55 crore a year earlier.

The cost of materials increased 43.2% to Rs 6,552.57 crore from ₹4,577.49 crore, putting considerable pressure on operating performance.

The company attributed the sharp increase in input costs to global uncertainties and volatile commodity prices.

Despite these challenges, MRF said price increases and cost-saving initiatives helped partially offset rising expenses.

Demand Remains Strong

MRF reported healthy double-digit sales growth, supported by continued demand from original equipment manufacturers and the replacement tyre segment.

However, the company cautioned that disruptions in global commodity markets could persist, keeping raw material and logistics costs elevated.

Management indicated that it would continue adopting measured pricing and operational measures to manage these challenges.

The outlook suggests that cost pressures could remain a key concern for profitability in the coming quarters.

Interim Dividend Announced

Meanwhile, MRF's board declared an interim dividend of ₹3 per equity share for shareholders.

The company fixed November 17, 2026, as the record date to determine eligible shareholders.

Dividend payments will be made on or after December 1, 2026.

Investors will closely monitor commodity price movements, demand trends and the company's ability to protect margins while sustaining revenue growth.

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