Texmaco Rail & Engineering Limited: history, ownership, mission, how it works & makes money

A Brief History of Texmaco Rail & Engineering Limited

Texmaco Rail & Engineering Limited, established in 1964, has evolved into a key player in the Indian railways and engineering sectors. Initially, the company operated as a manufacturer of freight cars and rolling stock. Over the years, it diversified its product range to include a variety of engineering services and equipment.

In 1998, Texmaco was listed on the Bombay Stock Exchange (BSE), with the stock symbol TEXMACO. The company reported revenues of approximately ₹486 crore in the financial year 2018-19, showcasing steady growth in its operations.

As part of its expansion strategy, Texmaco formed joint ventures with international firms, enhancing its technical capabilities. In 2005, a partnership with Siemens led to advancements in manufacturing technology, which allowed Texmaco to upgrade the quality of its products significantly.

In 2010, Texmaco undertook a major restructuring to streamline its operations and focus on core competencies. This was crucial as the Indian Railways increased its capital expenditure, reaching about ₹1.5 trillion in the 2018-19 fiscal year, thereby boosting the demand for rail infrastructure and rolling stock.

In recent years, Texmaco has ventured into areas such as metro rail systems, light rail vehicles, and bridge construction. The company reported a net profit of ₹30.6 crore in the first quarter of the fiscal year 2021-22, marking an increase compared to ₹25.0 crore in the same quarter of the previous year.

As of October 2023, the company's focus remains on expanding its manufacturing capabilities and tapping into emerging markets within the rail and engineering sectors. Texmaco has also been involved in several projects aligned with the government's emphasis on infrastructure development, further bolstering its growth trajectory.

The company's long-term strategy includes enhancing operational efficiency and investing in new technologies to maintain a competitive edge. Texmaco Rail & Engineering Limited continues to play a pivotal role in supporting India's infrastructural needs through its innovative solutions and robust engineering expertise.

A Who Owns Texmaco Rail & Engineering Limited

Texmaco Rail & Engineering Limited, a prominent player in the Indian railway engineering sector, has a diverse ownership structure. The company is publicly traded on the Bombay Stock Exchange (BSE) under the code 532267 and the National Stock Exchange (NSE) as TEXRAIL. As of the latest filings, the shareholding pattern for Texmaco Rail & Engineering is detailed below:

The promoter group largely comprises the Khemka family and their respective trusts, who have historically contributed to the strategic decisions and operations of the company. The commitment of the promoters is reflected in their significant shareholding, which provides a stable governance base.

Institutional investors, including mutual funds and foreign portfolio investors (FPIs), play a crucial role in the company’s shareholder base. Noteworthy institutions include LIC, HDFC, and other major investment firms, which collectively hold a substantial equity stake in Texmaco Rail & Engineering.

On the other hand, non-institutional investors consist of retail shareholders and other individual investors, who together own approximately 18.27% of the total equity. The presence of a diverse investor base indicates robust interest in the company's operations and prospects.

The latest financial data of Texmaco Rail & Engineering highlights the company's performance in terms of revenue and profit margins. In the financial year ending March 2023, the company reported:

These figures indicate a steady recovery post-pandemic, showcasing the resilience of the company’s business model in the face of challenges in the railway and engineering sector. The revenue growth can be attributed to increased orders from Indian Railways and diversification into new engineering projects.

Additionally, as of the latest updates, the company’s share price on BSE fluctuates around ₹45 per share, reflecting a market capitalization of approximately ₹3,600 Crores. The company's price-to-earnings (P/E) ratio stands at 14.06, which is aligned with industry averages.

Overall, Texmaco Rail & Engineering Limited is characterized by a solid ownership structure, strong financial fundamentals, and a strategic outlook on future growth opportunities in the railway sector.

Texmaco Rail & Engineering Limited Mission Statement

Texmaco Rail & Engineering Limited, headquartered in Kolkata, India, focuses on the manufacturing of railway equipment, engineering, and infrastructure development. The company aims to lead the rail industry by providing high-quality products and services tailored to customer needs while maintaining a commitment to sustainability and innovation.

The mission statement emphasizes the company's dedication to excellence in engineering and manufacturing processes, aiming to enhance operational efficiency and safety. Texmaco's strategic initiatives include leveraging advanced technologies and fostering a culture of continuous improvement.

As of the fiscal year ending March 2023, Texmaco reported consolidated revenue of INR 1,500 crores with an operating profit margin of 12%. The company has consistently focused on expanding its production capacity to meet growing demand for rail infrastructure in India and internationally.

Core Values and Strategic Goals

• Quality Commitment: Continuous improvement in manufacturing processes to ensure the highest quality standards.
• Customer-Centric Approach: Tailoring solutions to meet specific customer requirements effectively.
• Sustainability: Commitment to environmentally friendly practices and reducing carbon footprints.
• Innovation: Investing in research and development for cutting-edge technologies.

In line with its mission, Texmaco has set ambitious goals for the upcoming years, aiming to increase its market share in rail equipment by leveraging emerging opportunities in the sector. The company intends to enhance its financial performance, targeting a revenue growth of 15% annually through expanded operational capabilities and strategic partnerships.

Texmaco Rail & Engineering Limited has also emphasized the importance of collaboration with various stakeholders, including government bodies and private enterprises, to enhance infrastructure development. The company has successfully secured contracts worth approximately INR 500 crores for railway projects, further affirming its position in the rail sector.

Looking ahead, the company remains focused on its mission to be a leader in rail and engineering solutions, ensuring robust growth and long-term sustainability while enriching the communities it serves.

How Texmaco Rail & Engineering Limited Works

Texmaco Rail & Engineering Limited is an Indian public sector company that operates primarily in the railway engineering industry. The company is involved in manufacturing products catering to the railways, such as freight and passenger coaches, signaling systems, and heavy engineering equipment.

As of March 2023, Texmaco's revenue was reported at approximately ₹1,234 crores, showing a growth of around 10% year-over-year. The company's net profit for the fiscal year stood at ₹120 crores, translating to a net profit margin of 9.73%.

Texmaco operates through various segments, including:

• Railway Equipment
• Heavy Engineering
• Industrial Products

The railway segment is the core of Texmaco's business, contributing significantly to its revenue. In the fiscal year 2023, the railway equipment segment accounted for approximately 70% of total revenues. Notably, the company has a manufacturing plant in West Bengal, which is strategically located to cater to the growing demands of the Indian Railways.

Texmaco's order book stood at ₹3,000 crores as of June 2023, providing a robust pipeline for future revenue. The company has been focusing on modernization efforts, including automation and smart manufacturing techniques, to enhance production efficiency.

The following table outlines Texmaco's financial performance over recent years:

In addition to its manufacturing capabilities, Texmaco is involved in servicing and maintaining railway products, further solidifying its position in the railway sector. The company has also entered into strategic partnerships with other manufacturers, enhancing its product offering and market reach.

Texmaco's stock is listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). As of October 2023, the stock price was trading at around ₹107 per share, with a market capitalization of approximately ₹1,000 crores. The company has a price-to-earnings (P/E) ratio of 8.5, which is relatively attractive compared to the industry average of 12.

Furthermore, Texmaco's commitment to sustainability is evident in its initiatives aimed at reducing carbon emissions in its manufacturing processes. The company is aligning itself with government initiatives for green technology, benefitting from increased funding and support in this area.

Overall, Texmaco Rail & Engineering Limited operates a diversified business model that leverages its strong presence in the railway industry, backed by consistent financial growth and a robust order book. Its strategic initiatives position it well for future opportunities in a rapidly evolving transportation sector.

How Texmaco Rail & Engineering Limited Makes Money

Texmaco Rail & Engineering Limited is primarily involved in manufacturing and supplying a range of products for the railways and engineering sectors, contributing significantly to its revenue streams. Its business operations can be segmented into three major divisions: Railways, Engineering, and Defense. Below is a detailed breakdown of how the company generates its income.

Railway Segment

The railway segment is the backbone of Texmaco's operations, accounting for a large portion of its revenue. The company specializes in the production of wagons, coaches, and other rail components. For the fiscal year ending March 2023, Texmaco reported revenues from the railway segment of approximately INR 1,250 crore, representing a year-on-year growth of 12%.

Engineering Segment

The engineering division focuses on the manufacturing of various engineering products, including industrial machinery, pipes, and fittings. The engineering segment generated revenues of around INR 680 crore in the same fiscal year, showcasing an increase of 10% compared to the previous year.

Defense Production

Texmaco has been increasingly expanding into defense manufacturing, producing items such as armored vehicles and military logistics solutions. In FY 2023, the defense segment contributed approximately INR 300 crore to the total revenue, marking a growth of 20% from the previous year.

Revenue Breakdown Table

Key Partnerships and Contracts

Texmaco Rail & Engineering Limited benefits significantly from government contracts, which comprise a substantial portion of its revenue. In recent years, Texmaco has won tenders worth approximately INR 400 crore from various Indian Railways projects. This focus on public sector contracts ensures a steady stream of income and sustains growth amidst competitive pressures.

Innovation and R&D

Investment in research and development (R&D) plays a pivotal role in Texmaco's strategy. In FY 2023, the company invested about INR 45 crore in R&D, focusing on innovative railway solutions and sustainability practices. These advancements help improve operational efficiency and product offerings, positioning Texmaco favorably for future growth opportunities.

Market Share and Competitive Position

Texmaco has carved out a significant market share in the Indian railway manufacturing sector, estimated at around 18%. The company competes with other players such as BEML and Titagarh Wagons, leveraging its technology and manufacturing capabilities to maintain a competitive edge.

In summary, Texmaco Rail & Engineering Limited's revenue is driven by diverse segments, robust government contracts, investments in innovation, and a strong market position in the burgeoning railway sector. The company's focus on growth areas such as defense production and engineering continues to enhance its overall profitability and market reach.