IMFA Q1 FY27: Record quarter, with KNR capacity ramp-up driving scale

Indian Metals & Ferro Alloys Limited (IMFA) started FY27 with its strongest quarter on record. For Q1 FY27, revenue came in at ₹960.45 crore, up from ₹641.54 crore in Q1 FY26. EBITDA more than doubled to ₹281.27 crore from ₹125.47 crore, and profit after tax rose to ₹191.49 crore from ₹91.48 crore.

The company attributed the jump to two drivers that rarely show up together at the same time: higher ferro chrome volumes and firm pricing. In management’s words, Q1 FY27 reflected not only better realisations, but also the first meaningful benefit of the KNR 2 acquisition operating at full furnace count.

Volumes step up as KNR 2 stabilises

Operationally, the quarter marked a step change. Ferro chrome production reached 80,690 tonnes and sales were 79,268 tonnes. This was the first time quarterly production crossed 80,000 tonnes. The company also reported that approximately 14,000 tonnes of material were dispatched from the KNR 2 plant during the quarter.

Chrome ore raising remained strong at 272,555 tonnes in Q1 FY27, compared with 103,780 tonnes in Q1 FY26, reflecting both higher activity and the company’s focus on strengthening backward integration.

Average realisation per tonne of ferro chrome improved to ₹119,888 in Q1 FY27, versus ₹95,165 in Q1 FY26 and ₹109,352 in Q4 FY26.

Financial summary and what changed versus last year

The quality of earnings also improved. EBITDA margin expanded to 29.29% in Q1 FY27 from 19.56% in Q1 FY26, while PAT margin rose to 19.69% from 13.81%. The investor deck explicitly linked this to higher price realisation and cost efficiency.

A key quarter-on-quarter detail came from the concall. The CFO explained that “other expenses” were lower in Q1 versus Q4 largely because Q4 carried a negative mark-to-market impact of about ₹32 crore on hedges as the USD moved. In Q1, currencies remained broadly stable and the company recorded some forex gain.

The company highlighted that the figures are based on standalone financial statements.

Capacity expansion: KNR 1 commissioning timeline and FY27 production expectation

IMFA’s greenfield expansion at Kalinganagar (KNR 1) is the next near-term milestone. The company stated it has received Consent to Operate and the factory licence. The process of switching on the first furnace is underway, with hot metal tapping expected in the third week of August 2026. The second furnace is expected to be commissioned in September 2026.

Management also reiterated the strategic direction: with the greenfield project expected to be fully commissioned and stabilised by Q3, IMFA expects to close the year with operating smelting capacity of more than half a million tonnes.

However, the concall also included a clear course correction on FY27 tonnage expectations. The Managing Director said that while the company had earlier indicated 400,000 tonnes for FY27, it is “toning it down a little bit”. The reason is operational caution at KNR 2, where some transformers are not being loaded beyond a certain point, and additional work is needed on the gas cleaning plant to comply with emission norms. The company has ordered two sets of transformers plus a spare, and expects replacement activity across Q2 and Q3.

In the Q&A, management stated an expectation of about 380,000 tonnes of ferro chrome production for FY27. For FY28, the company maintained an expectation of 475,000 to 500,000 tonnes of production.

Energy transition: contracted renewables scale up

Power is one of the most important levers in ferro alloy economics, and IMFA continues to increase its non-fossil share via long-term arrangements. The company said it signed a long-term offtake arrangement with Enfinity Global for an additional 65 MWp hybrid renewable energy, expected to be available by June 2027.

With this addition, the company expects around 40% of its energy consumption to come from non-fossil sources by mid next year. The investor presentation also stated that contracted renewable energy capacity increased from 70 MW to 135 MW in Q1 FY27, including a 29-year agreement with EG Urja Strot Pvt. Ltd. for the additional 65 MW hybrid capacity.

Diversification: ethanol project nearing completion, with revised schedule

IMFA is also building a 120 KLD grain-based ethanol plant at Therubali as part of a diversification strategy. The press release noted the ethanol project is nearing completion, and any further delay is attributed to geopolitical uncertainty and monsoon-related disruptions. The company stated there is no material impact on financials from the delay.

The revised timeline shared is specific: the trial run is expected in October 2026, and the investor presentation indicated commissioning in November 2026.

Balance sheet disclosures in the deck

The investor deck disclosed that the company’s invested funds (mutual funds, bonds, fixed deposits and similar) were ₹555 crore. It also disclosed that long-term debt for KNR 1 and the ethanol project stood at ₹419 crore as of 30 June 2026.

Takeaways

IMFA’s Q1 FY27 was a volume-and-price driven record quarter, supported by the KNR 2 ramp-up and firm ferro chrome realisations. The near-term focus is execution: commissioning KNR 1 on schedule and resolving the ramp-up constraints at KNR 2 to enable higher stable loading.

Management was also explicit about what matters most over the next few quarters: reaching a smoother operating rhythm as capacity expands, with inventories, maintenance and emissions compliance fully aligned to a larger scale business. The next operational checkpoint is the first furnace tapping at KNR 1 expected in the third week of August 2026, followed by the second furnace commissioning expected in September 2026.