Rane Madras

A part of the Rane group, the auto components company makes steering and suspension linkage products and steer gear products. With the autos sector growing through some troubled times, like the poor numbers in Q2, the numbers showed a fall in Q3 too. The company’s growth in domestic OEM and aftermarket was negative, it fell 11% though exports  grew 5%, which is much lower than the 23% growth it showed in Q2. For Q3FY13, on a YoY, the company posted a net sales at Rs.152 crore, down 9%. Operating costs were down 9% and interest cost was down 12% sequentially. It ended the quarter with a  net profit at Rs.6.16 crore, down 14%.

The company’s total debt stood at around Rs.100 crore. Promoter holding is at 55.36% of which Rane Holdings hold 53.85%. Not a single institution has a stake in the company. The company will be able to show a better performance in Q4 only if the auto sector shows an uptake. With the company’s performance inextricably linked with that of the auto sector, a revival in demand for auto is imperative for the company to grow. Its net profit for 9MFY13 was at Rs.15.33 crore v/s Rs.27.40 crore for FY12. Thus to surpass FY12 numbers, Q4 has to be exceptionally good.