BENGALURU (Reuters) – Indian tyre maker Apollo Tyres Ltd reported a bigger-than-expected third-quarter profit on Thursday, aided by strong demand from original equipment makers and price increases.
The Gurugram-based company said its consolidated profit rose to 2.92 billion rupees ($35.54 million) from 2.24 billion rupees a year ago. That also beat an average analysts’ estimate of a 2.76 billion rupee profit, according to Refinitiv IBES data.
Apollo’s revenue from operations rose 12.5% to 64.23 billion rupees for the quarter ended Dec. 31.
Even as cost of materials consumed rose 12.3% to 29.93 billion rupees year-over-year, it fell 3.5% from the previous quarter, indicating a softening in raw material prices.
Tyre makers have been grappling with higher energy costs and raw material expenses as well as softer demand in Europe due to macro-economic challenges.
Profit before tax from the company’s largest operating segment – Asia Pacific, Middle East & Africa (APMEA) – more than doubled to 3.29 billion rupees from a year earlier.
However, profit before tax for its second-largest segment, Europe, dropped 29% from a year ago.
Apollo’s rival and Mumbai-based Ceat Ltd had in January reported a third-quarter profit from a loss a year earlier, aided by strong domestic demand.
($1 = 82.1610 Indian rupees)
(Reporting by Anisha Ajith in Bengaluru; Editing by Rashmi Aich)