On June 13, 2023, MRF made history by becoming the first company in Indian stock history to reach the level of Rs. 1 lakh per share in the cash segment. The stock's surge in recent times can be attributed to the company's strong March quarter results and increased profitability forecasts due to lower raw material prices. According to analysts, MRF's strong balance sheet and diversified revenue stream across segments make it less vulnerable to slowdowns. But before checking on the financials, let's first get to the company's business.
MRF, India's largest tire manufacturer and one of the Top 20 global manufacturers, has nine state-of-the-art factories in Tamil Nadu, Kottayam, Ponda, Medak, and Pondicherry. Established in 1946, the company has expanded its product range from two-wheelers to fighter aircraft and has a strong presence in the automotive tire and tube market. MRF has collaborated with US-based B.F. Goodrich Tyre Company, Hasbro International, Vapocure, and Pirelli for various products. MRF launched the premium truck tire Super Lug 50-FS. In 2008, MRF signed a memorandum of understanding with the Tamil Nadu government for a new plant and expansion of existing plants. In 2009-10, MRF increased its installed capacity of automobile tyres and automobile tubes, launching popular tyres like the MRF Meteor and MRF Steel Muscle S3K4 truck radials. In 2015, MRF signed a Memorandum of Understanding with the Tamil Nadu government to invest at least Rs 4500 crore in Tamil Nadu for its plants.
The company has shown consistent performance over the years. For the March quarter, consolidated total income rose by 3.42% on a Q-o-Q basis and 10% from the same quarter the previous year. On yearly basis, the company reported a rise of 18.48% in total revenue for FY23 to Rs. 23216 cr compared to Rs. 19633.71 in FY22.
The March quarter saw a sharp rise in net profit at Rs. 340.67 crore compared to Rs. 174.83 crore in December. On a year-over-year basis, the company reported a 14.90% increase in net profit after two consecutive years of falling net profits.
The stock has witnessed a year-to-date return of 13.40%, compared to 2.93% for the NIFTY 50 index. The stock's 52-week low as of June 14, 2023, was Rs. 65,878.35.
As of March 31, 2023, the promoters own 27.84 percent of the company, while the remaining 72.16 percent is owned by public shareholders, including FIIs and DIIs.