Tolins Tyres Limited’s wholly owned subsidiary, Terra Rubber Private Limited, has entered into a Purchase Agreement with Cochin Reclaim and Rubbers Private Limited to acquire plant and machinery for capacity expansion and backward integration. The agreement was executed on July 1, 2026, and involves the purchase of identified assets from Cochin Reclaim, an unrelated third party, on an “as-is, where-is” basis. This strategic move aims to enhance Terra Rubber's operational capabilities through the acquisition of necessary equipment.

The transaction does not constitute a related party transaction, as neither Terra Rubber nor Tolins Tyres holds any shareholding in Cochin Reclaim. The deal was negotiated and concluded on an arm's length basis. The acquisition is considered a routine purchase of plant and machinery in the ordinary course of business and does not impact the management or control of Tolins Tyres.

Under the terms of the agreement, Terra Rubber is required to remove the machinery from Cochin Reclaim’s premises within sixty days from the date of the agreement at its own cost. The title to each item of machinery will pass to Terra Rubber only upon full payment of its allocated value and its physical removal from the seller's premises. No material restriction or liability has been imposed upon the company or its subsidiary under this agreement.

The disclosures regarding the agreement were submitted to the stock exchanges pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Umesh M, Company Secretary and Compliance Officer of Tolins Tyres, confirmed that the agreement has not been rescinded, amended, or altered as of the date of the intimation.

Key Agreement Details

Tolins Tyres Limited reported a consolidated net profit of ₹35.69 crore for the financial year ended March 31, 2026, a decline of 7.72% from ₹38.67 crore in the previous year. The company's revenue from operations for FY26 rose 11.86% to ₹327.12 crore, compared to ₹292.45 crore in FY25. Despite the revenue growth, profitability was impacted by a contraction in EBITDA margins, which fell 519 basis points to 14.61%. The Board of Directors approved the audited financial results at a meeting held on May 28, 2026.

Financial Performance

For the quarter ended March 31, 2026, the company posted a net profit of ₹8.94 crore, a decrease of 3.67% from ₹9.28 crore in the corresponding quarter of the previous year. Quarterly revenue from operations stood at ₹77.99 crore, while total revenue was ₹78.92 crore. The EBITDA for Q4FY26 declined 17.27% to ₹11.22 crore, with margins shrinking to 14.39%. On a standalone basis, the net profit for the full year was ₹15.04 crore, down from ₹20.76 crore in the prior year.

Operational Metrics

The company’s net profit margin for the consolidated year stood at 10.91%, while the return on equity (ROE) was 9.88%. The debt-equity ratio remained low at 0.03 times. The earnings per share (EPS) for the year was ₹9.03 on a consolidated basis. Total expenditure for the year increased to ₹279.32 crore from ₹234.54 crore in the previous year, driven largely by rising raw material costs which stood at ₹244.67 crore.

Board Appointments

The Board appointed M/s. Joseph Cyriac & Company, Chartered Accountants, as the internal auditors for the financial year 2026-27. Additionally, M/s. BBS & Associates, Cost Accountants, were appointed as the cost auditors for FY27. The Board also reviewed and updated the Policy on materiality of Related Party Transactions to align with SEBI regulations.

Earnings Conference Call

Pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Tolins Tyres Limited has made available the audio recording of the earnings conference call held on June 1, 2026, at 5:30 P.M. IST. The recording discusses the audited financial results for the quarter and year ended March 31, 2026, and can be accessed on the company's website.

Management attributed the margin pressure primarily to GST revisions, where the tax rate on new tyres was reduced to 18% and agricultural tyres to 5%, while retreading materials remained taxed at 18%. This policy change reduced the price competitiveness of retreading. The company stated that the industry association has approached the government to reduce GST on retread materials to 5%.

Regarding operations, the company produced 5,35,870 tyres in FY26, a 36% increase over the previous year's 3,93,253 units. However, revenue growth lagged volume growth due to pricing dynamics. The Ras Al Khaimah plant in the UAE, with a capacity of 1,200 metric tons, is currently operating at less than 50% utilization due to geopolitical uncertainties and market conditions. Management expects to maintain FY26 performance levels in FY27, contingent on market stabilization by Q2.