Tolins Tyres Ltd

Event

• Terra Rubber Private Limited commenced construction of a reclaim rubber facility in Palakkad, Kerala.
• Facility will convert scrap tyres and rubber waste into reclaimed rubber via devulcanisation.
• Date of commencement: August 24, 2026.

Strategic and economic implications

• Backwards integration aims to improve raw-material efficiency and reduce virgin rubber reliance.
• Facility enables EPR certificate generation and potential transfer to tyre producers.
• Expected to strengthen Tolins' rubber value chain and circular manufacturing.

Business overview

• Core business: manufactures precured tread rubber and tyres under Tolins Tyres Brand.
• Backward integration: bonding gum, vulcanizing solutions, tyre flaps and tubes.
• Presence across India; exports to 40 countries; UAE facility in Ras Al Khaimah.
• Three manufacturing facilities: two in Kalady (Kerala), one in Ras Al Khaimah, UAE; capacity mix.
• Terra Rubber focuses on circular rubber ecosystem; expansion planned to support long-term growth.

Operational highlights

• Q1 FY27 consolidated revenue from operations ₹79.27 cr; India ₹69.28 cr; UAE ₹9.99 cr.
• Total revenue ₹79.51 cr; YoY change -12.13%.
• EBITDA (excl. Other income) ₹8.91 cr; EBITDA margin 11.24%.
• PAT ₹6.19 cr; PAT margin 7.81%.
• Terra Rubber expansion planned to strengthen sustainability-led growth.
• Strategy: expand domestic and international markets; pursue inorganic growth; broaden product range.

Financial performance

• FY26 revenue from operations ₹327.12 cr; total revenue ₹329.92 cr.
• PAT ₹35.69 cr; PAT margin 10.91%; EBITDA ₹47.80 cr; EBITDA margin 14.61%.
• Raw materials ₹244.67 cr; Employee cost ₹17.16 cr; Other cost ₹17.50 cr.
• Equity funds ₹361.24 cr; Total assets ₹392.55 cr.
• Borrowings: current ₹10.313 cr; non-current ₹0.52 cr; Cash ₹4.415 cr.
• Inventories ₹180.882 cr; Trade receivables ₹128.484 cr.

Capital structure & liquidity

• Borrowings total ≈₹10.83 cr (current ₹10.313 cr, non-current ₹0.52 cr).
• Cash and cash equivalents: ₹4.415 cr; liquidity modest.
• No material debt/credit rating action disclosed in the filing.

Strategy & outlook

• Management positives on long-term tyre market growth; Terra Rubber expansion.
• Plan inorganic growth via selective acquisitions and new product development.

Governance

• Board: Dr. KV Tolin (Chairman & MD); Jerin Tolin (Promoter, Non-Executive Director); Sankarakrishnan Ramalingam (Non-Executive Director).
• CFO: Mr. Sojan CS; investor relations managed by Adfactors PR.

Financial highlights

• Revenue from operations: ₹79.27 crore in Q1 FY27, down 11.67% YoY.
• EBITDA (excl. other income): ₹8.91 crore in Q1 FY27, vs ₹13.44 crore Q1 FY26.
• EBITDA margin: 11.24% in Q1 FY27 vs 14.97% Q1 FY26.
• PAT ₹6.19 crore in Q1 FY27; down from ₹9.30 crore Q1 FY26.
• PAT margin: 7.81% in Q1 FY27 vs 10.37% Q1 FY26.
• EPS ₹1.57 in Q1 FY27, vs ₹2.48 in Q1 FY26.
• Consolidated revenue: ₹79.27 crore; Profit Before Tax: ₹7.88 crore.

Operational mix

• India contributed ~87% of revenue; UAE ~13% in Q1 FY27.
• India revenue ₹69.28 crore; UAE ₹9.99 crore.

Geopolitical headwinds

• UAE operations faced near-term headwinds from war impacting trade and logistics.

Strategic initiatives

• Terra Rubber expansion to create opportunities in the circular rubber ecosystem and long-term growth.

Outlook & management view

• Management remains focused on disciplined execution and growth via Terra Rubber investments.

IPO proceeds utilisation status

• No deviation or variation in IPO proceeds utilization.
• Mode: IPO; funds raised on 16 Sep 2024; size ₹200 crore.
• Net proceeds available for utilization: ₹183.80 crore.
• Monitoring agency: Brickwork Ratings India Private Limited.
• Audit Committee approved the statement; no comments from auditors.
• Original allocation vs modified allocation: no deviation in reported objects.
• Funds utilised aligned with original objects.

Issue Overview

• Type of issue and securities: Fresh Issue and Offer for Sale of Equity Shares (Equity Shares).
• Total issue size and net proceeds: 230 crore; no undersubscription or revision noted.
• Main objectives: repayment of loans (company and subsidiary), long-term working capital, general corporate purposes, and issue expenses.

Utilisation of Proceeds

• Utilisation as per offer document: Yes; no material deviations observed.
• Deviations/changes: No material deviations or reallocations reported.
• Loans repayment (company): end-quarter utilization shown; no new disbursement; net unutilised -2.47 Cr.
• Working capital (company): end-quarter utilization shown; no change; net unutilised -0.08 Cr.
• Loans of subsidiary: end-quarter utilization 11.06 Cr; unutilised 4.09 Cr.
• Working capital of subsidiary: end-quarter utilization 12.09 Cr; unutilised -4.09 Cr.
• GCP: 2.78 Cr utilized in quarter; end-total 18.46 Cr; unutilised -2.78 Cr.
• Issue expenses: end-quarter utilization 14.08 Cr; unutilised 2.12 Cr.
• Any other: Nil.
• Unutilised funds status: no investments in fixed deposits or monitoring accounts disclosed.
• Delay in implementation: no delays reported for any object.

Governance and Compliance

• Approvals: all government/statutory approvals related to the objects obtained.
• Material events/issues: no disputes, regulatory actions, or management changes reported.
• Other information: no conflicts of interest disclosed; monitoring agency independent.

General Corporate Purpose (GCP)

• GCP utilisation: 2.78 Cr used for general corporate purposes.
• Board approval for allocation: not explicitly indicated in board comments.
• Status: allocation aligns with original GCP objective; no cost revisions recorded.

Financial results approved

• Unaudited Standalone results for quarter ended 30 June 2026 approved; total income 456.19 million; PAT 31.17 million.
• Consolidated unaudited results for quarter ended 30 June 2026 approved; total income 795.07 million; PAT 61.90 million.
• Limited Review Report on results issued with unmodified opinion.

Subsidiaries and investments

• Subsidiaries: Tolin Rubbers Private Limited, Tolins Tyres LLC (UAE), Terra Rubber Private Limited.
• Terra Rubber Private Limited became wholly owned in October 2025.
• Additional equity investment of Rs 6 lakhs in Terra Rubber Private Limited on May 6, 2026.
• Company continues to hold 100% stakes in all three subsidiaries.

Audit, governance and timing

• Board approved results on 12 August 2026.
• Independent auditor's review reports state no material misstatement.

• Certificate under Regulation 74(5) received from Registrar and Share Transfer Agent for the reporting quarter.

Transaction details

• Terra Rubber, a Tolins Tyres subsidiary, entered a purchase agreement with Cochin Reclaim on 1 July 2026.
• Agreement for purchase of identified plant and machinery for capacity expansion/backward integration.
• Purchase on an as-is, where-is basis; removal within 60 days at Terra Rubber's cost.
• Title passes to Terra Rubber only after full payment and removal.
• No shareholding in Cochin Reclaim; Cochin Reclaim is an unrelated third party.
• No impact on management or control; routine purchase in ordinary course.
• Not a related party transaction; arm's length negotiation.
• No shares issued; no nominees on board; no conflicts arising.
• No rescission or amendment as of date; future changes to be disclosed.

Rating action

• Rating action: CARE Ratings withdrew Tolins Tyres' bank facility ratings with immediate effect.
• Instruments affected: LT cash credit, LT term loan, ST packing credit, ST BG/LC.
• Proposed facilities ratings withdrawn as TTL did not avail them.
• Reason: surrender of facilities and no amounts outstanding.
• Rating agency: CARE Ratings Limited (CareEdge Ratings).