What explains Ceat at a 4-year high this week?
Answer
Answer
Answer
On Thursday, Ceat rallied by 10% to touch a 4-year high of Rs1,516. Robust business outlook was the key driver for the stock. In the last 3 months, Ceat rallied 60%. Yes, tyre demand is gaining traction, but Ceat also gained from easing pandemic curbs, pent-up demand from OEMs and strong replacement segment. To add to the story, the prices of key raw materials also cooled. Due to high tariffs imposed by the US and Europe on Chinese imports, Indian tyre export demand holds the key.