Following the release of its Q4 results, the company’s stock price increased; the quarter’s net profit was Rs 410.66 crore, up from Rs 156.78 crore in the same period of the previous year.
The share price of MRF, which has a face value of Rs 10, surpassed the milestone of Rs 1 lakh, reaching a historic high of Rs 1,00,439.95, before experiencing a decline below Rs 1 lakh. As of the time of preparing this report, the MRF share is being traded at Rs 99,969.95, showing an increase of Rs 1,001.40 (1.01 percent) from today’s opening price. The NIFTY, which is the index of the NSE, has risen by 93.05 percent, reaching 18,694.55.
The remarkable surge in MRF’s share price can be attributed to its significantly low equity base of Rs 4.24 crore, with the promoter group holding 27.84 percent of it. In the fiscal year 2022-23, the company distributed a dividend of Rs 175 per share (1,750 percent).
Anticipation of MRF’s share price surpassing the Rs 1-lakh mark had been prevalent since the company announced its financial results for 2022-23 in May. During the fourth quarter, the net profit of MRF amounted to Rs 410.66 crore, showcasing a significant increase of 163 percent compared to the corresponding quarter of the previous year, which recorded Rs 156.78 crore. The net profit from the fourth quarter accounted for half of the total net profit of Rs 816 crore for the entire year. On that particular day, the MRF share price rose by 2 percent (Rs 4,908.10), closing at Rs 93,505, indicating a potential leap above the Rs 1-lakh threshold.
The company attributed its favorable results to the “easing of raw material prices.” Rahul Mammen Mapillai, the Managing Director of MRF, stated to businessline that “the decline in commodity prices has resulted in a reduction in raw material costs for this quarter, which contributed to the improvement in our profitability.”