Shares of MRF Limited declined by 1.68% on the NSE today, closing at ₹1,18,987.60, down from the previous close of ₹1,21,025.95. This decline resulted in a significant market cap loss of approximately ₹840 crore, reducing MRF’s total market cap to ₹50,464.34 crore from ₹51,304.34 crore.
Key Financial Highlights from Q2 FY25 Results:
- Revenue from Operations: ₹6,760.37 crore, up 11.1% year-over-year (YoY) from ₹6,087.56 crore in Q2 FY24, but down 4.5% from ₹7,077.84 crore in the previous quarter (Q1 FY25).
- Profit Before Tax (PBT): ₹610.88 crore, marking a 21% YoY decline from ₹773.46 crore in Q2 FY24, and an 18.6% sequential drop from ₹750.88 crore in Q1 FY25.
- Net Profit (PAT): ₹455.43 crore, down 20.4% YoY from ₹571.93 crore in Q2 FY24, and a sequential decline of 19% from ₹562.55 crore in Q1 FY25.
Reason for Decline:
The decline in MRF’s share price and market cap can be attributed to the mixed Q2 FY25 financial results. Although revenue from operations saw an 11.1% increase YoY, profit metrics presented a different picture. The significant drop in PBT and PAT both on a YoY and QoQ basis indicates rising expenses or operational challenges, which have affected profitability despite increased revenue.
These results reflect ongoing margin pressures that have concerned investors, leading to today’s decline. Given MRF’s high stock price, even minor fluctuations have a substantial impact on its market cap, amplifying the effect of the weaker-than-expected profit figures.
Price Movement Details:
- Current Price: ₹1,18,987.60
- Previous Close: ₹1,21,025.95
- Percentage Change: -1.68%
- Market Cap Change: Loss of approximately ₹840 crore
- Total Market Cap: Now at ₹50,464.34 crore
This market reaction underscores investor caution, particularly around profitability challenges, as MRF faces pressure to improve its bottom line in upcoming quarters.