Ceat Ltd. share price target

Over the years, the company has decreased its share of revenue from CV (Commercial Vehicle) segment from 60% in FY10 to 40% in FY15 by increasing share of revenue from 2/3 wheeler, PC and UV segments. The company continues to focus on these segments going forward on the back of higher growth, good realizations and strong brand preference by the consumers.

Background: CEAT, part of the RPG group, is one among the top four tire manufacturers in India. With a total manufacturing capacity of 810 MT/day & manufacturing plants situated in Nashik, Bhandup (Mumbai) and Halol, Gujarat, the company manufactures all tires: Truck & Bus (42%),2W(20%), Passenger vehicles (10%). LCV (13%), Farm (9%) & Specialty (6%). In terms of market, replacement contributed 62% of the sales while OEM and exports make up 20% and 18% of the sales. CEAT has a robust distribution network consisting of over 3500 dealers, 33 regional offices and more that 100 C&F; agents. CEAT commands 12% market share in the T&B;...

(Mumbai) and Halol, Gujarat, the company manufactures all tyres: Truck & Bus (T&B;) (42%),2W(20%), Passenger vehicles (10%), LCV (13%), Farm (9%) & Specialty (6%). In terms of market,...

Consolidated EBITDA margin came in at 15.3%, up 270bps QoQ led by a 150bps QoQ improvement in gross margin and 110bps QoQ reduction in other expenses to- sales ratio. Improvement in gross margin was supported by decline in carbon black prices to INR55/kg from INR75/kg during 1QFY16, coupled with a major decline in synthetic rubber prices to ~INR95/kg from INR120/kg. Gross profit/kg remained almost flat QoQ as blended realization declined 3% YoY, in sync with the fall in the raw material basket (RMB). Management highlighted Personal mobility segments - PCR, UVR and 2W tyres - grew ~20%...

Background: CEAT, part of the RPG group, is one among the top four tire manufacturers in India. With a total manufacturing capacity of 810 MT/day & manufacturing plants situated in Nashik, Bhandup (Mumbai) and Halol, Gujarat, the company manufactures all tires: Truck & Bus (42%),2W(20%), Passenger vehicles (10%). LCV (13%), Farm (9%) & Specialty (6%). In terms of market, replacement contributed 62% of the sales while OEM and exports make up 20% and 18% of the sales. CEAT has a robust distribution network consisting of over 3500 dealers, 33 regional offices and more that 100 C&F; agents. CEAT commands 12% market share in the T&B;...

Background: CEAT, part of the RPG group, is one among the top four tire manufacturers in India. With a total manufacturing capacity of 810 MT/day & manufacturing plants situated in Nashik, Bhandup (Mumbai) and Halol, Gujarat, the company manufactures all tires: Truck & Bus (42%),2W(20%), Passenger vehicles (10%). LCV (13%), Farm (9%) & Specialty (6%). In terms of market, replacement contributed 62% of the sales while OEM and exports make up 20% and 18% of the sales. CEAT has a robust distribution network consisting of over 3500 dealers, 33 regional offices and more that 100 C&F; agents. CEAT commands 12% market share in the T&B;...

Background: CEAT, part of the RPG group, is one among the top four tire manufacturers in India. With a total manufacturing capacity of 810 MT/day & manufacturing plants situated in Nashik, Bhandup (Mumbai) and Halol, Gujarat, the company manufactures all tires: Truck & Bus (42%),2W(20%), Passenger vehicles (10%). LCV (13%), Farm (9%) & Specialty (6%). In terms of market, replacement contributed 62% of the sales while OEM and exports make up 20% and 18% of the sales. CEAT has a robust distribution network consisting of over 3500 dealers, 33 regional offices and more that 100 C&F; agents. CEAT commands 12% market share in the T&B;...