Ramkrishna Forgings Navigates Global Headwinds with Strong Domestic Performance and Strategic Expansion

Ramkrishna Forgings Limited, a key player in the forging industry, has reported a resilient performance for the third quarter and nine months ended December 31, 2025 (Q3 & 9M FY26). Despite a volatile global operating environment marked by geopolitical tensions, tariff actions, currency fluctuations, and elevated input costs, the company showcased robust growth driven primarily by its domestic business and strategic initiatives.

For Q3 FY26, the company reported consolidated net revenue of ₹1,098 crores, marking a 2% increase year-on-year and a significant 21% rise quarter-on-quarter. This turnaround was further highlighted by a Profit Before Tax (PBT) of ₹30 crores in Q3 FY26, a substantial improvement from a ₹5 crore loss in the preceding quarter. The nine-month consolidated revenue stood at ₹3,021.30 crores. The EBITDA for Q3 FY26 was ₹163 crores, up 29% year-on-year and 33% quarter-on-quarter, with an EBITDA margin of 14.9%, reflecting improved operational efficiency.

Strategic Diversification and Capacity Augmentation Drive Growth

The company's strategic emphasis on deepening domestic capabilities and diversifying its revenue base has yielded tangible results. The GST rate rationalization implemented in September played a crucial role in reviving customer sentiment in the automotive segment, leading to a sharp rebound in demand. Ramkrishna Forgings has successfully identified and penetrated adjacent growth segments, most notably Railways and Passenger Vehicles, which are now demonstrating strong momentum.

In Q3 FY26, the company secured new orders worth ₹680 crores with a program life of four years. Approximately 66% of these orders originated from the automotive sector, with ₹406 crores from the Commercial Vehicle (CV) segment, ₹26 crores from the Passenger Vehicle (PV) segment, and ₹18 crores from the Electric Vehicle (EV) segment. The remaining 34% came from non-automotive segments, with ₹189 crores out of ₹230 crores from the Oil & Gas sector. This reflects a continued progression in the company's diversification strategy.

Over the last four years, Ramkrishna Forgings has invested approximately ₹300 crores in acquiring machining facilities in Gurgaon and Jharkhand, alongside casting and forging facilities in Jharkhand, which achieved stabilization during FY25-26. An additional ₹242 crores has been invested in the rail wheel project. The company has deployed about ₹2651 crores in incremental capital expenditure across various forging and machining facilities, largely funded by internal accruals and equity, underscoring its disciplined capital allocation strategy.

Key Projects and Future Outlook

Several key projects are nearing completion or have recently commenced operations, promising significant future growth:

• Aluminum Forgings: Production has commenced, adding a new dimension to the product portfolio.
• Casting Plant: A new casting plant with 45,000 MT per annum capacity is expected to be commissioned in Q4 FY26.
• Forging Capacity: An additional 40,000 MT per annum forging capacity is also slated for commissioning in Q4 FY26.
• Railways - Bogie Assemblies: Bulk supplies of bogie assemblies have started for Indian Railways, which is showcasing huge demand, with an estimated ₹2,000 crores in demand for the forthcoming year.
• Rail Wheel Project: The joint venture to establish Asia's second-largest manufacturing plant for 228,000 forged wheels per annum is progressing as per schedule in Chennai, with trial run production expected by March 2026.
• Mexico Facility: Ramkrishna Forgings Mexico S.A. de C.V. has commenced machining operations, securing significant orders worth ₹200 crores over five years from a major North American customer. Bulk production is scheduled to begin from April 2026.

Sustainability and Employee Well-being

Ramkrishna Forgings is deeply committed to its ESG vision, aligning with nine United Nations Sustainability Development Goals. The company reported a 26% increase in recycled wastewater, a 145% increase in renewable energy mix, and a 39% decrease in Scope 1 emissions intensity for Q3 FY26. Initiatives include rainwater harvesting, integrated water-efficiency measures, and a 3% decrease in waste intensity. The company also emphasizes employee well-being, with 99% of permanent employees trained on ESG and Human Rights principles, and has earned 'Great Place to Work' certification for the second consecutive year.

Management Confidence and Forward Path

Management expressed confidence in improved performance in Q4 FY26 and sustained momentum into FY27. They anticipate achieving 80-85% utilization across capacities by the next financial year and aim to reduce debt to below ₹2,000 crores by the end of FY26. The company projects a 10-15% year-on-year growth (CAGR) for the next three consecutive years, with the PV segment expected to contribute 10% of total revenue by FY28. Ramkrishna Forgings is strategically positioned to leverage domestic growth opportunities and expand its global footprint, ensuring sustainable value creation for all stakeholders.