Rane Holdings locks in 20% upper circuit on acquiring major stake in JV Co

Shares of Rane Holding locked in 20 per cent upper circuit, hitting its 52-week high at Rs 1605.75 per share on the BSE in Monday’s intraday deals. This came after the company acquired 51 per cent stake in Rane NSK Steering Systems Private Limited, a joint venture with Japan’s NSK Limited.  

“The Board of Directors of Rane Holdings Limited (RHL) have approved the acquisition 51 per cent stake from the joint venture partner NSK Limited in Rane NSK Steering Systems Private Limited. Post-acquisition, the company will become a Wholly-Owned Subsidiary of RHL and named as Rane Steering Systems Private Limited (RSSL), subject to necessary approvals,” the company said in a statement on Monday.

Rane Holdings acquired  9.12 million equity shares of Rs10 each for an amount of Rs 45 crore from NSK Limited.

It further said that RSSL will continue the existing technology licence and supply agreements with NSK Steering & Control, Inc.

Harish Lakshman, Chairman of Rane Group said, "We deeply value the relationship with NSK over the past two and half decades which helped us to create a strong position in the Indian automotive steering market. This acquisition further expands our group’s expertise in the steering systems.”

Rane Holdings, the holding company of Rane Group, reported a consolidated net profit of Rs 38.4 crore for Q4FY24, bouncing back from a loss of just over Rs 8 crore in the year-ago quarter. Total revenue for Q4FY24 was Rs 874.4 crore, a decline of nearly 8 per cent compared to Rs 948 crore in Q4FY23. Earnings before interest, tax and depreciation (Ebitda) stood at Rs 87.6 crore, down 23.4 per cent from Rs 114 crore in Q4FY23, with an Ebitda margin of 10 per cent, lower than the 12.1 per cent recorded in Q4FY23.

For the full financial year FY24, Rane Holdings reported a net profit of Rs 149.6 crore, marking a significant increase of 71.4 per cent from Rs 87.3 crore in FY23. Total revenue was flat at Rs 3,544 crore compared to Rs 3,537.5 crore in FY23

The stock of the company is presently trading at a price to earnings multiple of 26.15 with an earning per share of Rs 51.17.  

Rane Holdings is primarily engaged in the manufacturing and marketing of components and providing technological services for the transportation industry mainly the automotive sector.