Chennai: MRF expects a challenging FY27 for the domestic tyre industry, with geopolitical tensions, higher input costs and a weak monsoon likely to pressure demand and margins.The government’s projected 7%-7.4% economic growth for FY27 has come under pressure due to the West Asia conflict, warning that higher energy prices, supply chain disruptions, rising logistics costs and higher subsidies could weigh on inflation, fiscal balances and domestic demand, the leading tyremaker said in its latest annual report.The Rs 31,140 crore company also said a below-normal monsoon could weaken agricultural activity and hurt rural demand, an important driver for the farm and two-wheeler tyre segments. However, it said India’s strong macroeconomic fundamentals should help the economy navigate these challenges.MRF expects profitability to come under pressure in FY27 as commodity prices has moved up after easing last year. The domestic tyre industry grew by around 10% in FY26, and tyre exports from India rose by 9%, helping margins improve. However, commodity prices are at an elevated level now, which will impact margins in FY27.On the export front, it expects recovery after a year of consolidation. Its export revenue rose marginally to ₹2,324 crore in FY26 from Rs 2,307 crore in FY25. After strong double-digit growth in HYFY26, exports slowed in H2 due to geopolitical disruptions.MRF said economic weakness in the Philippines, political developments in Bangladesh, election-related uncertainties in parts of Africa, and the Iran conflict disrupted demand and supply chains, particularly in West Asia, one of its key export markets. “The industry is currently navigating an environment of escalating raw material prices and elevated freight rates driven by the ongoing global crises,” it added.Looking ahead, the company expects newly launched truck radial and farm radial products to strengthen its presence in Europe and the Americas. It also plans to deepen its presence in Africa, Southeast Asia, and Europe.The company has been ranked as India’s Most Valuable and Strongest Tyre Brand and also features as the 3rd Strongest Tyre Brand in the World and among the Top 50 most valuable brands in India across all industries in the Brand Finance India 100 – 2026 report.
