Shares of Rane Group companies – Rane Engine Valve, Rane Brake Lining, Rane Holdings and Rane (Madras) – are on a roll, trading higher by up to 20% in an otherwise range bound market.
All these four stocks are quoting at their respective lifetime highs and rallied between 35%-74% thus far in September, as compared to a marginal 0.20% decline in the S&P BSE Sensex.
Rane Group of Companies is the preferred supplier of auto components to major OEMs (Original Equipment Manufacturer), both in India and abroad.
Among the individual stocks, Rane Brake Lining, the largest gainer among Rane Group stock, zoom 74% thus far in September. The stock quoting at Rs 1,390, has rallied nearly 200% from Rs 476 since July 20, after the company's net profit more than doubled to Rs 10.49 crore in June 2016 quarter (Q1FY17), against Rs 4.82 crore in the same quarter year ago.
The company said, during the quarter it undertook various cost reduction initiatives resulting in favourable material cost and reduced operational cost. The company's better cash generation and internal accruals helped to repay long term loans and significantly reduce finance costs.
Rane Engine Valve has rallied 57% from Rs 514 to Rs 807 on the BSE. Since August 11, the stock surged 76% from Rs 459, after the company announced the sale of part of its land in Alandur, Chennai at a market value of Rs 94.82 crore.
In August, the automobile components maker said that it plans to invest Rs 500-600 crore over the next three years.
The planned investment is to expand Rane Madras, Rane NSK (this is a joint venture with NSK of Japan) and on localisation to reduce import content. The major portion will go towards Rane Madras, for a doubling of capacity from the current 900,000 of steering gear a year, the Business Standard report suggests. LINK
Company 31/08/2016 LTP % chg Rane Brake 796.75 1390 74.46 Rane Engine 514.4 807 56.88 Rane (Madras) 390.55 540 38.27 Rane Holdings 716.3 967 35.00 Sensex 28452.17 28395 -0.20 LTP : Last traded price on BSE in Rs at 12:08 am