Rane Brake Lining has soared 18% to Rs 672, extending its Thursday’s over 15% rally on the BSE, after the company's net profit more than doubled to Rs 10.49 crore in June 2016 quarter (Q1FY17), on the back of strong operational performance. The auto parts & equipment makers had profit of Rs 4.82 crore in the same quarter year ago.
The stock is currently trading at its all-time high and rallied 40% in past two trading sessions from Rs 476 on July 20, as compared to 0.78% fall in the S&P BSE Sensex.
The company’s operational revenues grew 16% at Rs 121 crore in June quarter against Rs 104 crore in the corresponding quarter of previous year.
“During the quarter, the company 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 Brake Lining said in statement.
The robust growth of 29% in the Aftermarket segment is attributed to increase sales of Asbestos-free linings and favourable pull in Northern and Southern region, it added.
We are focusing on commencing supplies for new wins with Tier-I/OEM customers, which will provide impetus for growth in the upcoming quarter. Further we are expanding our range in the Aftermarket business, we are continuing to focus on operational efficiency to mitigate the headwinds in material and other operational cost, said L. Ganesh, Chairman, Rane Group.
The company manufactures friction material products such as brake linings, disc pads, clutch facings, clutch buttons, brake shoes and railway brake blocks.
The trading volumes on the counter jumped an over 10-fold with a combined 713,765 shares changed hands on the BSE and NSE till 11:18 AM.