Rane (Madras) Q3FY26: Revenue up 21.3%, profit jumps

Stock reacts to Q3 results

Rane (Madras) Limited (NSE: RML) shares gained 1.52% on Tuesday to close at ₹831.80 after the company reported its third-quarter financial results. During the session, the stock moved between an intraday low of ₹810.00 and a high of ₹837.90 on the National Stock Exchange. The move came as investors digested a sharp year-on-year improvement in profitability alongside double-digit revenue growth.

As of February 17, 2026, the company’s market capitalisation was reported at ₹23.03 billion (about $174 million). The day’s price action was modest, but it followed a quarter where the company indicated improvements in margins, operating leverage, and export execution visibility.

Q3FY26 headline numbers

For the quarter ended December 31, 2025, Rane (Madras) reported consolidated revenue of ₹1,019.1 crore, up 21.3% from ₹840.5 crore in the year-ago period. Consolidated net profit rose to ₹30.5 crore from ₹0.4 crore a year earlier. The company said the prior year profit was affected by a one-time tax credit reversal of ₹8.27 crore.

Separately reported quarterly consolidated “net sales” for December 2025 were stated at ₹1,015.15 crore, compared with ₹521.62 crore in December 2024. Quarterly net profit was also reported at ₹30.52 crore for December 2025. The same data set highlighted profit before tax (excluding other income) of ₹39.66 crore and profit after tax (PAT) of ₹31.14 crore for the quarter.

What stood out in profitability

Operational metrics cited alongside the quarter suggested a step-up in earnings quality. Operating profit to net sales was stated at 8.95% for the quarter, indicating margin expansion compared with prior periods. PBDIT was reported at a quarterly high of ₹90.81 crore.

Another metric highlighted was the operating profit to interest ratio, which improved to 6.18 times, described as the highest in recent quarters. The company also reported cash and cash equivalents of ₹43.43 crore at the half-year mark, supporting liquidity.

Segment performance: domestic, exports, and aftermarket

Management outlined strength across key revenue streams. Domestic OE sales revenue rose 18% year-on-year, supported by demand across passenger and commercial vehicle segments. International sales revenue grew 21%, driven primarily by the steering products category.

Aftermarket sales revenue increased 32%, though the company said the figure is not directly comparable due to business restructuring in the previous fiscal year. The company also stated that the integration of the previous year’s business acquisition is now complete, and the focus has shifted to geographic expansion within India and deeper penetration of friction products.

Nine-month performance points to steady growth

For the nine-month period ended December 31, 2025, Rane (Madras) reported total income of ₹2,824.7 crore, compared with ₹2,514.0 crore in the previous year. This translates to 12.4% growth over the comparable period.

Net profit for the nine months stood at ₹74.2 crore, up from ₹41.0 crore in the prior year. The company described the directional trend as growth in both revenue and profitability over the first three quarters of the fiscal year.

Margin expansion: management’s explanation

Analysts questioned the sustainability of a 310 basis point improvement in EBITDA margins. Management attributed the margin improvement to a favourable product mix and operating leverage. The company also said raw material costs have stabilised, while adding that it is focused on value engineering to offset potential volatility in steel prices.

These comments place emphasis on execution and cost discipline as key drivers behind the quarter’s profitability jump. The company’s narrative suggests the margin improvement was not attributed to a single factor, but to a combination of mix, scale, and tighter cost control.

International order book signals longer runway

In response to queries about export growth, the executive team cited a strong order book in the steering linkages segment. The company highlighted North American and European heavy-duty platforms as key contributors and projected a steady execution timeline over the next 18 to 24 months.

While the company did not disclose the value of the order book in the provided update, the timeline guidance matters because it frames exports as a multi-quarter driver rather than a one-off spike.

Balance sheet approach: capex and debt focus

On capital allocation, management said it remains disciplined on capital expenditure. The company prioritised internal accruals for capacity debottlenecking, indicating a preference for incremental investments rather than large expansion bets in the near term.

The discussion also touched on debt servicing strength through improved operating profit to interest coverage. Together, these points position the quarter as one where profitability strengthened while management maintained a cautious stance on spending.

Key data at a glance

Why the update matters for investors

The quarter combined double-digit top-line growth with a sharp improvement in profits, which is typically a key trigger for stock reactions in auto ancillaries. Management’s emphasis on product mix and operating leverage, along with commentary on stabilising raw material costs, provides context for the margin gains cited.

The export commentary adds an additional layer, as the company pointed to an 18 to 24 month execution window for steering linkages programs tied to heavy-duty platforms in North America and Europe. Alongside aftermarket normalisation after restructuring, these details frame the quarter as part of a broader operational transition rather than an isolated performance spike.

What to watch next

Investors are likely to track whether the margin improvement discussed, including the 310 basis point EBITDA margin expansion referenced in analyst questions, sustains in subsequent quarters. Monitoring the pace of export deliveries against the stated 18 to 24 month timeline will also be important.

The company’s comments on value engineering to manage steel-price volatility and its internal-accruals-led capex approach will be relevant for assessing cash generation and balance sheet resilience across the remainder of FY26.