65% Rally in a Year: Engineering Stock Sees Rising FII and DII Stakes, Is Another Rally Ahead?

Synopsis: Institutional investors have been raising their stake steadily even as promoter holding eased, while the stock has delivered sharp gains over the past year. Record annual earnings may explain the renewed interest.

Rising institutional ownership alongside strong stock performance often signals growing confidence in a company’s fundamentals. When this coincides with record financial results and an active expansion phase, it becomes worth a closer look at what’s driving the optimism and whether the momentum has more room to run.

Shares of Craftsman Automation Ltd. closed at Rs.9,100, down 1.41% over the previous close of Rs.9230.5. The company’s market capitalisation stood at Rs.23,860 crore and P/E ratio at 63.05. The stock has moved from around ₹5,580 at the start of July 2025 to ₹9,220 currently, a gain of nearly 65% over the past year.

FII and DII Stakes Have Been Rising Steadily

Craftsman Automation Ltd. is a diversified engineering business operating across three verticals – Powertrain, Aluminium Products, and Industrial & Engineering – serving commercial vehicles, passenger vehicles, tractors, and off-highway vehicles. It now runs 28 manufacturing facilities across nine Indian states and Germany, backed by long-standing OEM relationships and four decades of engineering experience.

Institutional investors have been steadily increasing their exposure to Craftsman Automation Ltd. over the past few quarters. FII holding rose from 15.19% in March 2026 to 17.28% in June 2026, while DII holding climbed from 28.29% to 32.90% over the same period. 

Combined, FIIs and DIIs now hold over 50% of the company, a sharp jump from the levels seen just a year earlier in mid-2025. Promoter holding, meanwhile, has eased from 48.70% to 42.41% as of June 2026, following a reduction that began earlier.

Public shareholding has also declined steadily, falling from over 15% in mid-2024 to 7.41% by June 2026, even as the total number of shareholders has fluctuated without a clear trend. The consistent rise in institutional stakes, even as promoter and public holdings have come down, points to growing confidence among funds in the company’s growth trajectory.

Record Revenue and Sharp Jump in Profitability

Craftsman Automation closed FY26 with consolidated revenue of ₹8,069 crore, up 42% over ₹5,690 crore in FY25, its highest-ever annual revenue from operations. EBITDA rose 51% year-on-year to ₹1,300 crore from ₹859 crore, while EBITDA margin also expanded. Profit after tax stood out the most, surging 91% to ₹384 crore against ₹201 crore in the previous fiscal.

The fourth quarter mirrored this strength. Revenue for Q4 FY26 came in at ₹2,226 crore, up 27% year-on-year, EBITDA rose 51% to ₹378 crore, and PAT climbed 73% to ₹116 crore compared to the same quarter last year.

On a five-year view, revenue has grown from ₹2,217 crore in FY22 to ₹8,069 crore in FY26, while PAT has moved from ₹163 crore to ₹384 crore over the same period, though FY25 saw a dip in profit growth before the sharp FY26 rebound. Net worth has also scaled up to ₹3,264 crore in FY26 from ₹1,136 crore in FY22.

All Three Business Segments Contributed to Growth

The company operates across three verticals: Powertrain, Aluminium Products, and Industrial & Engineering. Aluminium Products remains the largest contributor, making up 59% of FY26 consolidated revenue, followed by Powertrain at 27% and Industrial & Engineering at 14%.

Aluminium Products revenue grew 58% year-on-year to ₹4,789 crore, with EBIT up 58% to ₹494 crore. Powertrain revenue rose 20% to ₹2,179 crore, with EBIT climbing 44% to ₹361 crore. Industrial & Engineering revenue increased 30% to ₹1,102 crore, and EBIT more than doubled to ₹49 crore from ₹19 crore. The spread of growth across all three segments suggests the company isn’t leaning on any single business line to drive its overall numbers.

Expansion Through Acquisitions and New Facilities

FY26 was also a year of active inorganic and organic expansion. The company completed the acquisition of the balance 24% stake in DR Axion India Limited, took full ownership of Sunbeam Lightweighting Solutions, and acquired Craftsman Fronberg Guss GmbH along with Craftsman Germany GmbH, giving it a manufacturing presence in Europe alongside its India operations.

On the greenfield side, new facilities were added at Bhiwadi, Kothavadi, and Hosur, with a proposed satellite unit at Ludhiana and further expansion planned at Sriperumbudur through DR Axion’s subsidiary Srikara Technologies. The company now runs 28 manufacturing facilities across nine Indian states, with two more under construction, plus one plant in Germany, spread over a total built-up area of 3.6 million square feet.

Balance Sheet Metrics Moved Higher Alongside Growth

The debt-equity ratio rose to 1.02x in FY26 from 0.72x in FY25, and the net debt-to-EBITDA ratio inched up to 2.4x from 2.3x, reflecting the funding taken on for the acquisitions and capacity additions during the year. Average capital employed also rose sharply, to ₹5,321 crore from ₹3,952 crore a year earlier, consistent with the scale of expansion undertaken.

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.

The post 65% Rally in a Year: Engineering Stock Sees Rising FII and DII Stakes, Is Another Rally Ahead? appeared first on Trade Brains.