Airbag Makers, Auto Ancillaries Gain As Nitin Gadkari Proposes Six-Airbags Rule
Shares of Rane Group companies, as well as those of Autoline Industries, Varroc Engineering, Gabriel India and Minda, rose.
Shares of listed airbag makers and auto ancillary companies gained after Union Transport Minister Nitin Gadkari said the government was trying to make six airbags mandatory in eight-seater vehicles.
Shares of Rane Group companies, one of India's largest airbag and original equipment manufacturers, rose. Rane (Madras) Ltd., Rane Brake Lining Ltd., Rane Holdings Ltd. and Rane Engine Valve Ltd. all gained more than 5%.
Speaking at an event hosted by Business Standard on Tuesday, Gadkari said the government has decided to introduce a seatbelt beep system for the rear seats.
"We will issue a draft notification in three-four days (for making it mandatory for automakers to introduce a seat belt alarm system for rear seats also)," PTI reported Gadkari as saying.
Gadkari had said the government was also trying to make a law on making a minimum of six airbags mandatory in vehicles carrying up to eight passengers from October this year.
Several prominent auto ancillary stocks also rallied after Gadkari's comments.
Gadkari's comments come after billionaire industrialist Cyrus Mistry was killed in a car crash on Sept. 4. He was reportedly sitting on the rear seat of a vehicle without wearing a seatbelt.
The incident has put focus back on the issue of road safety in India. According to National Crime Records Bureau, more than 1.5 lakh lives were lost in road crashes across India in 2021.
In January, the Ministry of Road Transport and Highways had issued a draft notification mandating vehicles of category M1, "manufactured after Oct. 1, 2022, shall be fitted with two side/side torso air bags, one each for the persons occupying front row outboard seating positions, and two side curtain/tube air bags, one each for the persons occupying outboard seating positions".