Synospis: Ramkrishna Forgings reported 19.8% YoY revenue growth and 297% YoY PAT growth in Q1FY27. Backed by a Rs. 8,000 crore FY29 revenue target, 22–25% CAGR guidance, and expansion into aerospace and semiconductors, the company is targeting long-term growth.
The shares of this company are primarily engaged in manufacturing and sale of forged components for automobiles, railway wagons & coaches and engineering parts are in the spotlight after it rose by 8 per cent in today’s session following its robust results and management guidance to achieve up to 25 per cent CAGR by FY29.
With a market capitalisation of Rs. 11,204 cr, the shares of Ramkrishna Forgings Ltd were trading at Rs. 617.25 per share, increasing 8% in today’s market session, making a high of Rs. 624.65, up from its previous close of Rs. 579.35 per share.
Q1FY27 YoY Performance
Ramkrishna Forgings delivered a strong year-on-year performance in Q1 FY27. Revenue increased 19.8% YoY to Rs. 1,217 crore from Rs. 1,015 crore, while EBITDA surged 47% YoY to Rs. 218 crore from Rs. 149 crore. EBITDA margin improved significantly to 17.96% from 14.64%, reflecting better operational efficiency. Profit before tax (before exceptional items) jumped 172.5% YoY to Rs. 65 crore, with the PBT margin expanding to 5.37% from 2.36%.
QoQ Performance
On a sequential basis, the company reported a stable revenue performance, with revenue remaining flat at Rs. 1,217 crore. EBITDA rose 4.9% QoQ from Rs. 208 crore to Rs. 218 crore, while the EBITDA margin improved to 17.96% from 17.11%. Profit before tax increased 1.6% QoQ to Rs. 65 crore from Rs. 64 crore, with the PBT margin improving marginally to 5.37% from 5.29%.
It has mixed performance across its product segments in Q1 FY27. Forgings volume increased 4% YoY to 47,012 tonnes, driven by export volumes rising to 14,630 tonnes from 13,357 tonnes, while domestic volumes increased to 32,382 tonnes from 31,835 tonnes. Meanwhile, the castings business witnessed robust growth, with volumes surging 84.8% YoY to 8,593 tonnes, compared to 4,650 tonnes in Q1 FY26.
The company also recorded improved realisations in its forgings business. Domestic forgings realization increased to Rs. 2.05 lakh per tonne in Q1 FY27 from Rs. 1.78 lakh per tonne a year ago, while export realization improved to Rs. 2.42 lakh per tonne from Rs. 2.39 lakh per tonne. In the castings segment, however, realization remained largely stable at Rs. 1.31 lakh per tonne, compared to Rs. 1.30 lakh per tonne in the corresponding quarter last year.
Diversified Revenue Mix Strengthens Growth Profile
Ramkrishna Forgings continued to strengthen its domestic business in Q1 FY27, with domestic revenue contributing 67.7% of total revenue. The domestic automotive segment remained the largest contributor at 48.8%, followed by railways at 6% and mining, earthmoving & farm equipment at 5.7%. Revenue from miscellaneous sectors, including industrial components, steel, cement, and power, accounted for 7.2%.
On the exports front, international business contributed 32.3% of total revenue during the quarter. Automotive exports accounted for 28.3%, while other exports contributed 4%, including 0.3% from the oil & gas sector. The diversified revenue mix across domestic and export markets highlights the company’s balanced business model and expanding presence across multiple end-user industries.
During the first quarter, new orders worth Rs. 278 crore were booked with a program life of 4 years by the Automobile segment. The company also won orders worth Rs 15 crore from the metro segment of Indian Railways. Of the total worth of Rs 278 crore, around 82% of the orders are from the PV Segment while the remaining 18% are from the 2-wheeler segment.
Guidance and Management Outlook
The management still believes that the company will be able to meet its goal of Rs. 8,000 crore of revenues by FY29, indicating a 22-25% CAGR for the next three years. Moreover, it aims at an ROCE of 12-15% in FY27, followed by another rise to 20% in FY28.
In terms of finance, the firm intends to cut down its net debt by at least Rs. 500 crore in FY27, while keeping its capex for the period at approximately Rs. 350 crore. The management also plans to optimize its working capital by proper management of receivables, inventories, and payables.
As for the growth strategy, Ramkrishna Forgings has begun trial production at its Rail Wheel JV and bulk production is expected to start by September-October 2026. The firm also plans to enter the non-ferrous forging business segment and manufacture products like aluminum, titanium, and inconel for aerospace, robotics, and semiconductor industries. The bulk supply of aluminum forging has already been initiated, but titanium and inconel products are expected to bring significant revenue in the next two years with relatively low capital expenditure.
In conclusion, Ramkrishna Forgings appears well-positioned to deliver its targeted 22–25% CAGR and higher ROCE by FY29, supported by strong execution, improving profitability, and a diversified growth strategy. Its expansion into aerospace, robotics, and semiconductor applications through non-ferrous forgings, coupled with the Rail Wheel JV and continued deleveraging, could strengthen its long-term earnings profile and enhance shareholder value.
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