Ceat spurts ahead on demand recovery and margin expansion hopes

Stock of tyre maker was up 20% on Thursday

Ceat led the rally in tyre stocks gaining over 20 per cent in trade on Thursday even as the broader markets ended in negative territory. Its peer, JK Tyre & Industries, was up 17.6 per cent, while market leaders MRF and Apollo Tyres were up 7.8 per cent and 6.6 per cent respectively.

Improvement in demand from auto-makers on easing chip supplies, steady replacement sales, and margin recovery hopes from Q3FY23 are the key triggers that fuelled the rally. Further, for Ceat, the quantum of capital expenditure (capex) is expected to come down going ahead and investments done so far would