Viaz Tyres: FY26 revenue rises 89%, expansion plan targets 3x scale by FY29

Viaz Tyres Limited is trying to move from a tube-led manufacturer into a broader mobility products platform. In FY26, the company delivered sharp top-line growth and higher absolute profits, even as margins softened under input-cost pressure and higher finance costs.

For the year ended March 31, 2026, revenue from operations grew to ₹108.34 crore (₹10,834.36 lakh), up 89.2% from ₹57.26 crore (₹5,725.88 lakh) in FY25. EBITDA increased 31.5% to ₹9.57 crore (₹957.02 lakh), and profit after tax from operations rose 58.0% to ₹5.27 crore (₹527.33 lakh). The second half was the major driver. H2FY26 revenue more than doubled to ₹65.74 crore (₹6,574.04 lakh), up 127.6% YoY, while H2 EBITDA rose 25.2% to ₹5.35 crore (₹534.82 lakh). The earnings profile, however, showed the strain of a lower margin mix and a lag in passing through raw-material inflation.

At a business level, Viaz remains anchored in butyl inner tubes, where it positions itself among India’s largest organised manufacturers. The company also sells ancillary and allied products, and it has begun laying the groundwork for tyre manufacturing across multiple categories. The investor message is clear. The tube business provides scale, distribution access, and recurring replacement demand. The next leg is tyres, which offer higher realisation per unit and a larger addressable market. Management frames this shift as execution-led rather than aspirational, pointing to existing manufacturing experience and a wide dealer network.

FY26 in numbers: growth led by volume, margins under pressure

The headline result is strong growth. But the quality of that growth matters for investors, because the margins moved the other way.

For FY26, EBITDA margin declined to 8.83% from 12.71% in FY25. The second half margin compression was sharper, with H2FY26 EBITDA margin at 8.14% versus 14.78% in H2FY25. A key reason is visible in the cost line. Cost of materials consumed rose to ₹93.17 crore (₹9,316.85 lakh) in FY26 from ₹44.80 crore (₹4,479.67 lakh) in FY25, broadly tracking the revenue ramp but pulling down profitability. The company also highlighted a one-quarter lag in cost pass-through, implying temporary margin impact during periods of rising input prices.

Below EBITDA, finance cost increased to ₹2.29 crore (₹228.67 lakh) from ₹1.48 crore (₹147.87 lakh), reflecting higher funding needs as the balance sheet expands. Depreciation was flat at ₹1.84 crore (₹184.13 lakh). With these moving parts, profit before tax still grew 43.1% to ₹6.39 crore (₹638.79 lakh). PAT margin, though, moderated to 4.87% from 5.83%.

Financial summary (₹ lakh)

The pattern suggests a company in a scale-up phase. Revenue momentum is strong, absolute earnings are rising, but the cost base has expanded faster in the recent period. That makes the next year important, because the planned capacity build and portfolio shift will likely raise fixed costs and working capital needs before benefits show up in margins.

Manufacturing base and capacity build: the bridge to tyres

Viaz’s current identity is deeply tied to butyl inner tubes. It operates an in-house manufacturing model for tubes and sells through a broad distributor network. The company underlines replacement-led demand as the stabiliser, as tubes in two- and three-wheelers tend to be replaced 2 to 3 times more frequently than tyres.

The existing facility is described with 7.60 million units annual capacity, 90% to 95% utilisation, and asset turnover of 5.8. That is a high utilisation level, and it explains why the company is focused on adding capacity and categories.

The new manufacturing facility is central to the FY27 and FY29 narrative. The presentation outlines a 1,50,000 sq. ft. facility in Mehsana district, Gujarat, with a 2 MW captive solar plant, expected to be operational by Q1FY27. This plant is designed to manufacture 2W tyres, 3W tyres, LCV tyres, and agri and farm equipment tyres. The new facility annual capacity is presented at 1.60 million units with 50% estimated utilisation and asset turnover of 7x.

This matters because it changes what investors should track. In the tube business, utilisation is already high, and growth often comes from incremental volume gains and distribution expansion. In tyres, the company will need to build product acceptance, deliver consistent quality, and ramp utilisation without losing control of working capital. The presentation argues the timing is right, pointing to India’s tyre market growing from about USD 13.4 billion to USD 27.6 billion by 2033 at a 7 to 8% CAGR, and highlighting that over 70% of Indian tyre demand comes from the replacement market.

Capital raise, cash flows, and balance sheet: funding the next phase

To fund the expansion, Viaz highlighted a preferential fund raise that includes both equity shares and convertible warrants.

The company stated that 11.86 lakh equity shares were allotted at ₹70 per share and 35.11 lakh convertible warrants were issued at ₹70 per warrant, with participation from promoter and non-promoter investors. The stated use is broad: capex, distribution scale-up, working capital strengthening, and overall balance sheet support.

Cash flow disclosures show a shift toward investment mode. The presentation states that cash flow from investing activities increased in outflow, with a focus on property, plant and equipment, consistent with expansion. It also notes significant inflow from equity issue, share warrants, and borrowings.

The balance sheet expanded meaningfully between FY25 and FY26. Total assets rose to ₹88.00 crore (₹8,800.02 lakh) from ₹58.90 crore (₹5,890.20 lakh). Net fixed assets increased to ₹19.89 crore (₹1,988.77 lakh) from ₹11.27 crore (₹1,126.71 lakh), and capital work in progress stood at ₹11.63 crore (₹1,163.26 lakh), signalling ongoing project execution. Equity capital increased to ₹14.31 crore (₹1,430.70 lakh) and reserves to ₹42.32 crore (₹4,232.23 lakh). Borrowings also rose. Long-term borrowings increased to ₹6.59 crore (₹659.19 lakh) and short-term borrowings stood at ₹13.17 crore (₹1,317.13 lakh).

For investors, this is the trade-off. Expansion requires capital. The risk is that working capital intensity and funding costs rise before the new facility reaches stable utilisation. The company’s own narrative acknowledges macro uncertainty and raw material volatility, and says it maintained an inventory buffer of 3 to 4 months to protect operations.

Market positioning: a replacement-led core with export support

Viaz’s pitch rests on two pillars: stable repeat demand in tubes and tyres, and an ability to sell through a wide network.

The company cites a presence across 19+ Indian states and export markets including the USA, Turkey, Romania, UAE, and Colombia, and lists export countries such as Libya, Oman, USA, Dubai, Turkey, Romania, Sudan, Egypt, Brazil and Colombia. Exports are stated as 15% to 20% of total product sales.

The investor presentation also positions the company as a one-stop mobility brand, covering tyres, butyl tubes, lubricants, repair kits and air pumps. From an investment lens, this is more than catalogue expansion. It is a distribution strategy. Dealers prefer fewer vendors if product quality and supply consistency are reliable. A wider basket can increase share of wallet, raise channel stickiness, and potentially improve working capital terms over time.

Management commentary reinforces the strategic logic. The chairman and managing director, Mr. Janakkumar Patel, describes the shift from commodity-led tubes to tyres as a move into higher realisation products inside a largely replacement-driven industry. The new Mehsana facility is framed as the turning point that broadens the addressable market into four categories at once.

What to watch next: execution milestones and margin repair

Viaz has set a clear medium-term ambition. The presentation states a planned capex of ₹50 to ₹55 crore to scale revenue from ₹108 crore to ₹350 crore by FY29, while expanding PAT margins from 6% to 8% to 10%. That is a demanding target in a competitive category, and it will require both utilisation ramp and margin recovery.

A few markers will likely define the next phase.

First is the commissioning timeline. The new facility is expected by Q1FY27, and the company also refers to it being operational in CY2026. Investors will want clarity on stabilised production, product approvals, and early offtake.

Second is gross margin discipline. The company has already acknowledged a one-quarter lag in price pass-through. If input costs remain volatile, the ability to manage pricing without losing volume becomes critical.

Third is working capital and cash conversion. The company says operational efficiency is improving and working capital cycles are tightening. With higher inventory buffers and new product ramp, the proof will come through sustained operating cash flows and controlled borrowing.

Finally is channel execution. Viaz’s base of 2,000+ dealers is a real asset, but tyres and tubes behave differently in terms of warranties, brand perception, and repeat purchase triggers. The speed at which the company builds product trust in tyres will influence realisations and utilisation.

The FY26 result shows a company that can grow quickly and deploy capital to expand. The margin compression shows the cost of scaling. The investment case now depends less on intent and more on delivery: commissioning the new Mehsana plant on schedule, ramping utilisation toward the levels seen in tubes, and restoring margins as raw-material pass-through normalises. If those pieces land, Viaz’s plan to become a broader tyre manufacturer by FY29 becomes easier to underwrite.