Rane Brake gains after strong Q1 performance

Rane Brake Lining added 2.48% to Rs 977.40 after the company reported 70% jump in net profit to Rs 8.8 crore on a 5% increase in income from operations to Rs 159.9 crore in Q1 FY25 as compared with Q1 FY24.

Rane Brake Lining stated that the sales to OE customer grew 8%. The strong growth in this segment was driven by demand from two wheelers and passenger vehicle segments.

However, sales to Aftermarket customers declined 4%. Liquidity issues in the market coupled with high inventory with distributors led to lower sales.

Export sales grew 29%. The company executed orders from US and appointed dealers in new regions such as Kenya and Uganda.

Total expenses rose 2% to Rs 148.5 crore in Q1 FY25 over Q1 FY24, due to higher raw material costs (up 10% YoY), higher other expenses (up 8% YoY) and higher employee expenses (up 11% YoY).

EBITDA stood at Rs 18.1 crore for Q1 FY25 compared to Rs 12.3 crore reported during Q1 FY24, an increase of 46.6% on YoY basis. EBITDA margin was at 11.3% in Q1 FY25 against 8.1% in Q1 FY24.

"EBITDA margin improvement was mainly driven by operational improvement activities and forex. This was partially offset by unfavourable mix, the company said in a statement.

Profit before tax in Q1 FY25 stood at Rs 12 crore, up by 66% from Rs 7.2 crore posted in Q1 FY24. Tax outgo for the period under review was Rs 3.1 crore (up 55% YoY).

Rane Brake Lining (RBL) is part of the Rane Group of Companies, a leading auto component group based out of Chennai. RBL manufactures friction material products such as brake linings, disc pads, clutch facings, clutch buttons, brake shoes and railway brake blocks. RBL is market leader in India and global player in friction material.

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