RACL Geartech Limited, a prominent player in the automotive component manufacturing sector, has announced a groundbreaking strategic technical agreement with ARRK Engineering GmbH, a leading German engineering services provider. This partnership marks a significant step for RACL Geartech as it aims to expand its capabilities and transition from a component supplier to an end-to-end engineering and industrialization solution provider.

Synergizing Expertise

The alliance brings together ARRK Engineering's advanced expertise in product design, prototyping, virtual simulation, testing, and validation with RACL Geartech's established capabilities in mass production of high-precision gears, shafts, and precision machined components. This collaboration is set to cater to the evolving needs of the global automotive and E-Mobility markets.

Enhanced Service Offerings

Through this partnership, RACL Geartech is positioning itself to offer comprehensive solutions that go beyond manufacturing. The company will now be able to provide:

• End-to-end solutions for driveline and other precision components
• Product design services
• Engineering solutions
• Testing and validation services

Early-Stage Integration

A key advantage of this agreement is RACL Geartech's ability to offer concept-to-production solutions to OEMs and Tier-1 suppliers at earlier stages of product development cycles. This early integration is expected to streamline the product development process and potentially reduce time-to-market for new automotive solutions.

Value Chain Advancement

Jitender Jain, Chief Financial Officer of RACL Geartech Limited, emphasized the strategic importance of this partnership, stating, "It shall enable RACL to move up the value chain from being a component supplier to an end-to-end Engineering & Industrialisation solution provider."

Market Impact

The collaboration is anticipated to strengthen RACL Geartech's position in the automotive supply chain, particularly in the rapidly growing E-Mobility sector. By combining ARRK's advanced design, simulation, and validation tools with RACL's manufacturing prowess, the company is set to offer more comprehensive and innovative solutions to its clients.

This strategic move by RACL Geartech aligns with the global trend of automotive suppliers expanding their service offerings to meet the complex demands of modern vehicle development, especially in the context of electric and hybrid powertrains.

As the automotive industry continues to evolve, partnerships like this between manufacturing specialists and engineering service providers are likely to play a crucial role in shaping the future of mobility solutions.

RACL Geartech , a precision engineering company specializing in automotive components, has reported a strong start to the fiscal year, with significant growth in profitability and new business acquisitions.

Financial Performance

In the first quarter, RACL Geartech achieved revenue of ₹107.96 crores, marking a 2% year-on-year growth. The company's profitability saw a notable improvement, with EBITDA rising 20% to ₹26.80 crores. The EBITDA margin expanded to 24.83% from 21.10% in the previous year, demonstrating enhanced operational efficiency. Profit after tax increased by 28% to ₹8.29 crores.

Export Performance and Revenue Mix

Exports continued to be a significant contributor to RACL's revenue, accounting for ₹65.50 crores or 60.31% of the total. However, the company's export-to-domestic revenue mix shifted from 70:30 to 60:40, indicating growing traction in the domestic market.

New Business Nominations

RACL Geartech has secured important new business nominations, expanding its footprint in both domestic and international markets:

1. High-Volume Order from Indian Two-Wheeler Manufacturer: The company has received a prestigious nomination for a high-volume order from an Indian two-wheeler manufacturer for premium motorcycles. Production is set to commence in January/February 2026, marking RACL's entry into a new segment of the domestic market.

2. Order from BRP Canada: RACL has bagged an order from BRP Canada for 150,000-180,000 parts annually, starting in 2026. This order is for a new product family of shifting drums, expanding RACL's product portfolio.

Strategic Developments

Board Expansion

RACL has strengthened its leadership by adding two new directors to its board:

• Mr. Pravir Kumar, a retired IAS officer with extensive experience in government and commerce, joins as a non-executive independent director.
• Mr. Rakesh Kapoor, a seasoned techno-financial professional, has been appointed as a non-executive director.

BHEL Vendor Registration

The company has successfully registered as an approved vendor for Bharat Heavy Electricals Limited (BHEL), opening up new opportunities in the public sector engineering space.

Technology Focus

RACL is actively developing new technologies for electric vehicles and expanding its product portfolio beyond transmission gears. The company is working on projects such as Electronic Roll Control (ERC) systems, steer-by-wire technology, and electric power steering systems for various global automotive manufacturers.

Future Outlook

Despite global economic uncertainties, RACL Geartech's management maintains its revenue guidance and expects to achieve ₹1000 crore revenue by FY29. The company has planned a capital expenditure of ₹50 crores for FY26 to support its growth initiatives and new product developments.

Chairman & Managing Director Gursharan Singh commented on the results, stating, "Our focus on value-based business and technological innovation continues to drive our growth. The new business nominations and our expanding product portfolio position us well for sustainable long-term growth in both domestic and international markets."

As RACL Geartech continues to navigate the evolving automotive landscape, its strategic focus on premium segments and future technologies appears to be yielding positive results, setting a strong foundation for future growth.