MRF becomes the first Indian stock to touch Rs.1 lakh per share mark
Written by Sanjay Kumar
- MRF makes history, touching one lakh rupees per share mark.
- Strong Q4 performance: 86% YoY profit increase, 10.12% YoY revenue rise.
- Analysts recommend MRF for long-term investors due to strong balance sheet and diversified revenue streams.
MRF
Tyre company
- Type – Public
- Traded as – BSE: 500290
- NSE: MRF
- ISIN – INE883A01011
- Industry – Tyres, Rubber products
- Founded – Tiruvottiyur, Madras, Tamil Nadu, India (1946; 77 years ago)
- Founder – K. M. Mammen Mappillai
- Headquarters – Chennai, Tamil Nadu, India
- Area served – Worldwide
- Key people – K.M.Mammen (Chairman), Rahul Mammen Mappillai (MD)
- Products, Tyres, Toys, Sports equipment, Conveyor belt, Paints, Coats
- Revenue – + ₹23,261.20 crore (US$2.9 billion) (2023)
- Number of employees – 18,000+ (2021)
On Tuesday (June 13), MRF achieved a significant milestone by becoming the first Indian stock to reach the value of one lakh rupees per share. Starting at Rs 99,500 on the Bombay Stock Exchange (BSE), the stock experienced a slight increase from its previous close of Rs 98,939.70 and reached an all-time high of Rs 1,00,300 during morning trade.
Over the past year, MRF has exhibited robust gains, outperforming the benchmark Sensex with a 45 percent increase compared to the Sensex’s 19 percent gain. On June 17, 2022, MRF shares hit a low point for the year at Rs 65,900.05 on the BSE. As of the previous session’s closing, the stock has climbed 50 percent from that level.
The company delivered strong financial results for the January-March quarter, primarily driven by a decline in raw material prices. In the fourth quarter of FY23, MRF’s consolidated profit after tax (PAT) stood at Rs 313.53 crore, marking an 86 percent year-on-year (YoY) increase from the net profit of Rs 168.53 crore recorded in the corresponding quarter of FY22. Additionally, its consolidated revenue from operations in the fourth quarter of FY23 rose by 10.12 percent YoY to reach Rs 5,841.7 crore, compared to Rs 5,304.8 crore in the fourth quarter of FY22.
During Q4FY23, the company’s net expenses amounted to Rs 5,410.26 crore, compared to Rs 5,142.79 crore in Q4FY22. The earnings per share (EPS) of MRF for the quarter under review reached Rs 803.26, surpassing the Rs 389.55 recorded in the same quarter of the previous year.
Analysts find MRF’s fundamentals attractive and recommend it as a long-term investment option for those who can afford it. However, in the short term, the stock’s high valuation diminishes its attractiveness. Given the significant gains it has already experienced, profit booking is a possibility.
Experts highlight the strength of MRF’s balance sheet and the diversified nature of its revenue streams across various segments, reducing its vulnerability to a slowdown in any particular sector. Therefore, investors with substantial resources may consider MRF as a viable long-term investment opportunity.
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