Emerald Tyre H2FY26 Results: Revenue up 12%, PAT drops 32%
Emerald Tyre Manufacturers reported H2FY26 revenue of ₹11,294.31 lakh, up 12% YoY, but net profit fell 32% to ₹276.61 lakh due to rising finance costs. EBITDA grew to ₹1,579.83 lakh. Full-year FY26 revenue was ₹21,815.96 lakh with significant increases in fixed assets and borrowings.
*this image is generated using AI for illustrative purposes only.
Emerald Tyre Manufacturers reported a 12% year-on-year increase in revenue from operations to ₹11,294.31 lakh for the half-year ended March 31, 2026, but saw its net profit fall by 32% to ₹276.61 lakh. The divergence between top-line growth and bottom-line contraction was driven primarily by a sharp rise in finance costs and increased employee benefits expense, which outpaced operational efficiency gains. This performance underscores the challenge of managing leverage during periods of capacity expansion and working capital buildup.
The company filed its investor presentation under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, with the National Stock Exchange of India Limited on July 27, 2026. The filing provides a detailed breakdown of financial performance for H2FY26 compared to H2FY25, highlighting shifts in cost structures and income composition.
Financial Performance H2FY26
Revenue from operations grew from ₹10,093.34 lakh in H2FY25 to ₹11,294.31 lakh in H2FY26. Other income also surged significantly, rising from ₹79.79 lakh to ₹327.86 lakh, contributing to a total income increase to ₹11,622.17 lakh from ₹10,173.13 lakh.
However, total expenses climbed more sharply than revenue. Raw material costs increased to ₹6,459.11 lakh from ₹5,816.00 lakh, while employee benefits expense jumped to ₹1,517.57 lakh from ₹1,050.73 lakh. Finance costs nearly doubled to ₹761.17 lakh from ₹489.69 lakh, reflecting higher debt servicing obligations amid recent capital expenditure cycles.
| Particulars | H2 FY26 (₹ Lakhs) | H2 FY25 (₹ Lakhs) |
|---|---|---|
| Revenue from operations | 11,294.31 | 10,093.34 |
| Other Income | 327.86 | 79.79 |
| Total Income | 11,622.17 | 10,173.13 |
| Raw Materials | 6,459.11 | 5,816.00 |
| Employee benefits expense | 1,517.57 | 1,050.73 |
| Other expenses | 2,065.66 | 1,922.03 |
| Total Expenses | 10,042.34 | 8,788.76 |
| EBITDA | 1,579.83 | 1,384.37 |
| Finance costs | 761.17 | 489.69 |
| Depreciation and Amortization | 373.65 | 299.98 |
| PBT | 445.01 | 594.71 |
| Tax expense | 168.40 | 189.60 |
| PAT | 276.61 | 405.11 |
EBITDA improved to ₹1,579.83 lakh from ₹1,384.37 lakh, indicating better operational margins before financing and depreciation costs. However, the combined impact of higher finance costs and depreciation pulled profit before tax down to ₹445.01 lakh from ₹594.71 lakh.
What the Numbers Show
The most critical observation is the decoupling of EBITDA growth from PAT decline. While operations generated ₹195.46 lakh more in EBITDA, the bottom line suffered due to non-operating pressures. Finance costs rose by ₹271.48 lakh, largely eroding the operational gains. This suggests that the company’s recent capacity expansions—such as the new automated rubber mixing plant and solid tyre manufacturing upgrades—are currently debt-funded, leading to higher interest burdens before these assets reach full utilization. The presentation notes that full utilization could support revenue potential of ~₹350 crore by FY28, implying that current profitability is temporarily suppressed by the investment phase.
Balance Sheet and Strategic Outlook
For the full year FY26, revenue from operations stood at ₹21,815.96 lakh, up from ₹19,946.80 lakh in FY25. Total borrowings increased significantly, with long-term borrowings rising to ₹5,765.61 lakh and short-term borrowings to ₹7,803.48 lakh. Fixed assets grew substantially to ₹13,016.91 lakh from ₹5,572.85 lakh, confirming heavy capital deployment.
Management emphasized strengthening its position as a leading off-highway tyre manufacturer through product innovation and geographic diversification. The company aims to reduce reliance on any single market by expanding in Europe, Australia, Latin America, Saudi Arabia, and Southern Africa. New premium products like the AXIMO solid tyre range are expected to improve realizations and profitability in the coming quarters.
Historical Stock Returns for Emerald Tyre Manufacturers
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -2.86% | -1.39% | -8.31% | -13.42% | -34.27% | -56.94% |
How long will it take for the new automated rubber mixing plant and solid tyre upgrades to reach full utilization and offset the current surge in finance costs?
What specific strategies is Emerald Tyre employing to mitigate rising raw material costs, which increased by over 11% year-on-year?
To what extent will the geographic expansion into Europe, Australia, and Latin America diversify revenue streams and reduce dependency on domestic markets by FY28?
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