MRF becomes first company to trade at ₹1 lakh per share on BSE

If one had chosen to purchase a single share in the tyre company MRF ten years ago, their investment today would be worth ₹1 lakh, as per today’s trading on the Bombay Stock Exchange.

MRF has become the first company on the Bombay Stock Exchange to see its per-share value surpass the ₹1 lakh threshold during mid-day trading.

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From its initial mark of ₹10,000 on February 21, 2012, the tyre producer has seen an impressive 900 per cent increase in its share price. However, the journey from ₹90,000 to ₹1 lakh took over two years, with the stock first closing above the ₹90,000 mark on January 20, 2021, and hitting a previous record high of ₹99,933 on May 8. As of 9:45 AM today, shares of MRF are trading 1.1 per cent higher at ₹1,00,066 each. By 11 AM, the stock was trading at ₹99,998 per share.

The stock categorised as mega-cap, has been on an upward trajectory for the past three days, accumulating a 3.5 per cent gain in that timeframe. So far this year, MRF’s shares have appreciated 13 per cent and have experienced a 45.92 per cent surge over the previous year.

Impressive earnings for quarter ending March 31, 2023

The company reported impressive earnings for the quarter ending March 31, 2023. Its net profit soared by 161.6 per cent YoY and 142.7 per cent sequentially to ₹410.66 crore. Additionally, operational revenue increased by 10.1 per cent YoY to ₹5,725.39 crore during this period. Its margin also significantly expanded to 14.7 per cent in Q4 FY23 from 10.2 per cent in the previous year, and EBITDA jumped 60 per cent YoY to ₹843.1 crore.

MRF has also recommended a final dividend of ₹169 per share for FY23, bringing the total annual dividend of the mega-cap company to ₹175 per share.

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Analysts from the brokerage firm, Motilal Oswal, said in their report that they had been positively surprised by MRF’s Q4 FY23 performance. They attributed the lower Raw Material (RM) costs to the significant boost in EBITDA margin to 14.7 per cent (against the estimated 11.9 per cent). The firm believes this margin recovery will likely continue in FY24 due to falling RM costs and operational leverage.

Tyre manufacturers, including MRF, are reaping the benefits of a strong rebound in the commercial vehicles sector. Medium-heavy commercial vehicle volumes improved by 43 per cent YoY in 2022-23, while light commercial vehicles grew by 27 per cent. Goods tonnage for Medium & Heavy commercial vehicles grew by 54 per cent YoY to 10.1 million tons, 15 per cent higher than the peak tonnage in FY19.