Markets India
MRF announced a ₹3 per share interim dividend for FY27 despite an 8% year-on-year profit decline. The stock's 21% annual drop underscores investor concerns about sustaining profitability amid rising costs.
MRF declared an interim dividend of ₹3 per equity share for FY27, with a record date of November 17 and payment due by December 1. This decision comes as the company reported Q2 net profit falling 28% year-on-year to ₹369 crore, despite revenue growth of 18% to ₹8,524 crore.
The dividend payout highlights MRF's commitment to shareholder returns amid operational challenges. However, rising material costs and a 22% surge in total expenses—outpacing revenue growth—are squeezing margins. EBITDA dropped to ₹522 crore from ₹700 crore in the same period last year, while earnings per share fell to ₹912 from ₹1,243.
Shareholders face a 21% annual decline in MRF's stock price, with shares closing at ₹1,25,070.85—its 52-week high—and hitting a low of ₹1,15,333.30 earlier this year. Analysts note that while resilient tyre demand from automakers provides stability, supply chain pressures and cost inflation threaten long-term margins.
Competitors in the Indian tyre sector face indirect pressure as MRF's experience with material costs becomes a broader industry challenge.
Shareholders must hold shares by November 17 to receive the dividend. MRF will report FY27 full-year results in March 2027, offering further insight into its financial trajectory.
MRF's ₹3 dividend signals stability but raises questions about sustaining profitability amid rising costs and supply chain challenges.
Topics: Markets, India, Dividends, Tyre Industry, Corporate Finance, Stock Performance, Supply Chain Costs
#MRFDividend #IndiaStocks #TyreIndustry #CorporateFinance #SupplyChainCosts #SharePriceDecline
Source: LiveMint
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