Recommendation from Automobile & Ancillaries Sector

This section gives a recommendation of a stock having stock price below Rs 150 with sound fundamentals and expected to give handsome returns over a one-year time horizon.[EasyDNNnews:PaidContentStart]

Remsons Industries Ltd. : QUIETLY DRIVING INDIA’S MOBILITY REVOLUTION

HERE IS WHY
✓  Hidden Leadership in a NicheSegment
✓  Strategic Diversification Across Mobility Ecosystem
✓  Margin Expansion Through Value-Added Products

The global automotive industry is entering a transformative phase driven by electrification, digitalisation, and sustainability. Automakers are rapidly scaling hybrid and electric vehicle production while investing in advanced battery and autonomous technologies. The AsiaPacific region, especially India and China, has emerged as a manufacturing hub for vehicles and components. India, projected to become the world’s thirdlargest passenger vehicle market by 2030, is benefiting from government initiatives.

Within this evolving ecosystem, Remsons Industries Ltd, headquartered in Mumbai, has quietly become a vital component supplier to India’s mobility revolution. Established in the 1970s, the company manufactures control cables, gear shifters, push-pull systems, pedal boxes, and flexible shafts—essential components for mechanical precision and safety in vehicles. It supplies leading OEMs such as Maruti Suzuki, Tata Motors, Hero MotoCorp, Bajaj Auto, TVS, and Mahindra.

With over five decades of engineering expertise, Remsons has grown into a global technology-driven enterprise with seven manufacturing facilities (five in India and two in the UK) and six R&D centres across India and Europe, and exporting to more than 20 countries.

The company has delivered impressive financial performance in recent years, driven by diversification, technology, and operational efficiency. In FY25, revenue from operations rose 21 per cent YoY to ₹377 crore, supported by a stronger product mix, exports, and strategic acquisitions. EBITDA increased 20 per cent to ₹37.4 crore, maintaining margins at 10 per cent, while net profit grew 8 per cent to ₹14.4 crore. The momentum continued in Q1 FY26, with total income up 31 per cent year-on-year to ₹100.81 crore, operating profit rising 64 per cent to ₹11.77 crore, and net profit surging 78 per cent to ₹4.8 crore.

The company’s growth strategy centres on technology-led diversification. It has expanded into high-value, EV-agnostic components through acquisitions and joint ventures—BEE Lighting (UK) for adaptive LED systems, Remsons-Uni Autonics for advanced sensors, and Daiichi Remsons Electronics for infotainment and digital clusters. It has also entered electric mobility via a 36 per cent stake in Astro Motors and diversified into Railways and Defence through Remsons Edge Technologies.

With an Order Book exceeding ₹700 crore, including long-term contracts from Stellantis North America, Ford Turkey, and Tata Motors, Remsons enjoys strong revenue visibility. It aims to triple revenue to ₹900–1,000 crore by FY29, supported by ₹100 crore capex and targeted margin expansion to 13–14 per cent.

At current levels, the stock trades at a P/E of 31x, marginally below the industry average of 33x and near its five-year median of 33.5x, reflecting fair valuations relative to its earnings momentum. The EV/EBITDA stands at 12.5x, and the P/BV at 3.92x versus the industry’s 3.36x, supported by ROE of 12.2 per cent and ROCE of 14.4 per cent. With a low debt-equity ratio of 0.69x, interest coverage of 4.7x, and a PEG ratio of 0.70x, the company’s financial foundation remains solid.

Remsons Industries may not have the brand recall of larger ancillaries like Bosch or Motherson, but its strong OEM relationships, growing exports, and entry into new mobility and technology domains make it an emerging Small-Cap growth story. With multiple levers, sound governance, and a clear expansion roadmap, we recommend a BUY on Remsons Industries Ltd as a quietly accelerating leader in India’s evolving automotive landscape.

[EasyDNNnews:PaidContentEnd] [EasyDNNnews:UnPaidContentStart]

[EasyDNNnews:UnPaidContentEnd]