CEAT Q4FY21 revenue is up 45 percent but margins contracted for the company both on a year-on-year (YoY) and a quarter-on-quarter (QoQ) basis. Kumar Subbiah, CFO of the company said that a large part of the revenue growth was due to volume growth.

“Q4 we grew by little over 2.5 percent over Q3. A large part of our revenue growth in Q4 was on account of volumes and the same is the case YoY,” he said in a interview to CNBC-TV18.

However, according to Subbiah, the current quarter (Q1FY22) looks weak. He said that the April volume decline was in the early double digits. He is hoping for a recovery in June but said that it was too early to say if June will be normal.

“April was a weak month and the outlook for the month of May, even early June looks weak. Many of the dealers are not able to run the shops, OEMs have been cutting down production as the sales in the month of April was lower. So, demand outlook for current quarter looks weak,” he said.

He also said that the decline in gross margins in Q4 was on account of raw material cost increases. He further added that there was a need for a price increase of 6-8 percent to offset raw material cost increases.

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(Edited by : Abhishek Jha)