Apollo Tyres spent Rs 4,045.3 crore on raw materials in its India business in the July-September 2026 quarter, equal to 68.3% of India revenue, up from 62.0% a year earlier. That jump of more than six points of revenue is the clearest measure yet of what record natural rubber prices are doing to Indian tire makers, and it explains why the company's India EBITDA margin fell from 15.3% to 11.1% even as India revenue grew 25.6%.
The trigger came on Monday, 2 November 2026, when the Rubber Board's official price for RSS-4 sheet rubber reached an all-time high of Rs 300 per kg in the Kottayam and Kochi markets, Onmanorama reported on 3 November. The same report put the international RSS-4 price at Rs 266.69 per kg, which leaves Indian buyers paying about 12.5% more for domestic sheet than for the comparable grade abroad. Rubber Board Chairman N Hari told PTI the price had reached a historic high.
Indian sheet rubber now costs 12.5% more than the international grade
The record is not a local spike on top of a calm world market. World Bank data show the Singapore RSS3 benchmark averaged $2.83 per kg in October 2026, 41.5% above the $2.00 average of October 2025, while TSR20, the block rubber most used in truck and bus tires, rose 49.1% from $1.71 to $2.55 over the same twelve months. Both series have climbed almost without pause since January 2026, when RSS3 averaged $2.14.
What has changed in India is the premium on top of that global rise. In June 2024, according to the Rubber Board's own daily price table, Kottayam RSS-4 averaged Rs 20,067 per 100 kg against Rs 19,388 for Bangkok RSS-3, a domestic premium of only 3.5%. By 2 November 2026 the gap had widened to 12.5%. ANRPC data tell the same story in dollars: Kottayam RSS-4 averaged $2.50 per kg in April 2026, almost level with the World Bank RSS3 average of $2.51, but by September 2026 it was $2.88, about 4.7% above the $2.75 RSS3 average.
Two local factors widen the premium. The PTI report quoted a Pala processor who said farmers are selling raw latex rather than processing it into sheets, which has thinned sheet supply; he estimated sheet prices are 60% to 70% above last year's level. The Rubber Board's other grades on the same day were lower than RSS-4: RSS-5 at Rs 294 per kg, SNR-20 at Rs 280 and 60% latex at Rs 197.60. Import duty on dry rubber, which the processor described as 25% or Rs 30 per kg, whichever is lower, limits how quickly imports can close the gap.
India still produces only 63% of the natural rubber it consumes
The structural reason Indian prices can float above world levels is a supply gap that has not closed in four years. Rubber Board figures show production rose from 839,000 tonnes in 2022-23 to 905,000 tonnes in 2025-26, a gain of 7.9%, while consumption rose from 1,350,000 to 1,427,000 tonnes, or 5.7%. The shortfall was 511,000 tonnes in 2022-23, peaked at 559,000 tonnes in 2023-24 and was still 522,000 tonnes in 2025-26.
| Fiscal year | Production (t) | Consumption (t) | Gap (t) | Self-sufficiency | NR imports (t) |
|---|---|---|---|---|---|
| 2022-23 | 839,000 | 1,350,000 | 511,000 | 62.1% | n/a |
| 2023-24 | 857,000 | 1,416,000 | 559,000 | 60.5% | 492,682 |
| 2024-25 | 875,000 | 1,410,000 | 535,000 | 62.1% | 551,000 |
| 2025-26 | 905,000 | 1,427,000 | 522,000 | 63.4% | 459,000 |
Self-sufficiency, measured as production divided by consumption, moved only from 62.1% to 63.4% over the period. The Rubber Board's Statistics Consultative Panel, which met in May 2026, put natural rubber imports for 2025-26 at 459,000 tonnes, down 16.7% from 551,000 tonnes, while imports of compounded rubber rose to 349,000 tonnes from 245,000 tonnes. Stocks were already thinning before the current squeeze: the Board's July 2024 release counted 372,085 tonnes held by growers, processors, traders and manufacturers at the end of March 2024, down 15.9% from 442,602 tonnes a year earlier.
The panel also reported that the auto tire sector accounted for nearly 64% of natural rubber consumption in 2025-26, which implies roughly 913,000 tonnes, and that the sector's consumption fell 4.0% during the year while general rubber goods grew. In other words, tire makers were already economizing on natural rubber before prices hit the record.
Material costs rose about 25% while tire prices rose 13% to 15%
The quarterly results filed between mid-October and early November show how much of the rubber shock tire makers have absorbed. Apollo Tyres, which reported on 4 November, told analysts that its India raw-material basket rose about 25% from a year earlier, with natural rubber up around 25% to 26% and crude-linked materials up 28% to 35%, according to the European Rubber Journal. Against that, the company had taken cumulative price increases of 13% to 15% across Indian categories by the end of October.
The gap between those two numbers shows up in the margin. Consolidated revenue rose 16.6% to Rs 7,968 crore, but EBITDA fell to Rs 855 crore from Rs 1,021 crore and the consolidated margin dropped to 10.7% from 14.9%. In India the EBITDA margin was 11.1%, below 12.0% in April-June and 15.3% a year earlier, and India raw-material spending rose 38.5% against revenue growth of 25.6%.
Peers show the same pattern. CEAT's standalone EBITDA margin was 10.14% in July-September against 13.69% a year earlier, and consolidated net profit fell 39.8% to Rs 112 crore even though revenue rose 26.2% to Rs 4,762 crore, Autocar Professional reported. MRF's April-June results showed cost of materials consumed of Rs 5,854.23 crore on revenue of Rs 8,415.50 crore, or 69.6%, up from 60.2% a year earlier, and an EBITDA margin of 11.77% against 13.95%. JK Tyre's consolidated EBITDA margin was 7.1% in July-September after 6.8% in April-June; management said its raw-material basket rose 22% in the first quarter and a further 9% in the second.
Price increases are catching up, but the November record resets the baseline
Tire makers are recovering some ground. JK Tyre raised net realization 7% quarter on quarter in July-September after 4% to 5% in April-June and said it plans another 4% to 5% in October-December, while expecting its raw-material basket to rise a further 4% to 5%. Apollo said further increases could follow depending on input costs. CEAT management said it will pursue calibrated pricing actions and expects commodity pressure to persist into the third quarter.
The difficulty is that the third quarter began from a higher base. In late July, when brokerage Equirus Securities reviewed tire makers' annual reports, it described domestic natural rubber as having moved from above Rs 220 to Rs 280 per kg. The Rubber Board panel recorded a peak of Rs 262 per kg on 14 May 2026. The 2 November level of Rs 300 is 14.5% above that May peak and 49.5% above the June 2024 Kottayam average of Rs 200.67. Rubber bought in October and November will reach income statements in the December quarter, so the full effect of the record has not yet been reported.
What the numbers mean for buyers and investors
Tire makers: With domestic RSS-4 12.5% above the international quote, the import route is worth reassessing for grades and plants where duty and logistics allow. The 2025-26 shift toward compounded rubber imports, up to 349,000 tonnes, suggests some buyers have already done this. Price increases of 13% to 15% have not matched a raw-material basket up about 25%, so margin recovery depends on further hikes or on rubber easing.
Raw-material buyers: The domestic premium widened from 3.5% in June 2024 to 12.5% in November 2026, and RSS-4 is trading Rs 20 above SNR-20. Formulations that can substitute block rubber for sheet, and contracts indexed to international benchmarks rather than Kottayam, offer the most direct savings. Our natural rubber market analysis tracks these grade spreads.
Distributors and replacement retailers: Manufacturer price increases are still coming, with JK guiding to another 4% to 5% in October-December. Buying ahead of announced increases protects margin, but inventory financing costs rise with every round. Demand data in our replacement tires market report show where pass-through has been easiest.
Vehicle makers: Apollo described meaningful price increases in original-equipment supply alongside replacement increases of up to 15%. Fitment contracts with raw-material indexation clauses will reprice in the coming quarters; see our original equipment tires market coverage for fitment trends.
Investors: The best single indicator to watch is raw-material cost as a share of revenue. It rose to 68.3% at Apollo India and 69.6% at MRF from about 60% to 62% a year earlier. Each point it falls back is roughly a point of EBITDA margin regained, before operating leverage.
Methodology and sources
Prices are nominal. Domestic premiums compare Rubber Board prices for Kottayam RSS-4 with the international price quoted on the same basis, in rupees per kg. Raw-material shares divide reported cost of materials by revenue from operations for the same entity and quarter. All percentages were recomputed from the underlying figures; percentage-point changes are labeled as points.
- Onmanorama, 3 November 2026: RSS-4 record of Rs 300 per kg on 2 November 2026 and international RSS-4 at Rs 266.69 per kg.
- PTI via Deccan Chronicle, 3 November 2026: Rubber Board prices for RSS-5, SNR-20 and latex, chairman's comment, processor estimates and duty description.
- World Bank Commodity Price Data (Pink Sheet), monthly series updated 3 November 2026: RSS3 and TSR20 monthly averages, January 2024 to October 2026.
- Rubber Board of India, statistical release of July 2024: 2022-23 and 2023-24 production, consumption, imports and stocks, and June 2024 daily Kottayam and Bangkok prices.
- Rubber Board Statistics Consultative Panel, reported by Tyre Trends on 29 May 2026: 2024-25 and 2025-26 production, consumption, imports, tire sector share and the 14 May 2026 price peak.
- Rubber Board Executive Director, reported by UNI on 7 October 2026: confirmation of 2024-25 and 2025-26 production and consumption.
- ANRPC monthly statistical reports, via Tyre Trends: Kottayam RSS-4 at $2.50 per kg in April 2026 and $2.88 per kg in September 2026.
- European Rubber Journal, 9 November 2026 and Multibagg summary of Apollo's investor presentation, 5 November 2026: Apollo consolidated and India results, raw-material costs and price increases.
- Autocar Professional, 14 October 2026 and Kotak Neo, 14 October 2026: CEAT results.
- Kotak Neo, 11 August 2026: MRF April-June 2026 results.
- Multibagg, 30 October 2026: JK Tyre results, raw-material basket and realization guidance.
- Autocar Professional, 29 July 2026: Equirus Securities review citing domestic natural rubber at Rs 220 to Rs 280 per kg.
Company figures for Apollo, CEAT, MRF and JK Tyre are taken from published press and research summaries of the companies' filings and should be checked against the filings themselves for investment decisions. Related reading: natural rubber latex market.
Frequently Asked Questions
Rs 300 per kg: the Rubber Board's official RSS-4 price reached that all-time high in the Kottayam and Kochi markets on 2 November 2026.
About 12.5% more: domestic RSS-4 was Rs 300 per kg against an international RSS-4 price of Rs 266.69 per kg, up from a 3.5% premium in June 2024.
India produced 905,000 tonnes in 2025-26 against consumption of 1,427,000 tonnes, a 522,000-tonne gap and self-sufficiency of 63.4%.
Apollo's India raw-material bill rose to 68.3% of revenue from 62.0% and its India EBITDA margin fell to 11.1% from 15.3% in July-September 2026. CEAT's standalone margin fell to 10.14% from 13.69%.
Likely: JK Tyre plans another 4% to 5% increase in October-December, after Apollo took cumulative increases of 13% to 15% against a raw-material basket up about 25%.
Nearly 64% of national consumption in 2025-26, or roughly 913,000 tonnes, and the sector's use fell 4.0% during the year.