Ratnamani Q1 FY27: Standalone slowdown, subsidiaries steady the ship

Ratnamani Metals and Tubes opened FY27 with a weaker quarter at the parent company level, but the consolidated picture held up better because of a sharp improvement in subsidiary performance. For Q1 FY27, consolidated revenue from operations came in at 971.63 crore versus 1,151.62 crore in Q1 FY26. Consolidated EBITDA was 179.79 crore with an EBITDA margin of 18.5 percent, while consolidated profit after tax stood at 107.03 crore.

The standalone performance saw a sharper decline. Standalone revenue fell to 740.78 crore from 1,062.40 crore a year ago, and standalone EBITDA dropped to 105.18 crore from 226.62 crore. EBITDA margin at the standalone level declined to 14.2 percent from 21.3 percent. The company attributed the pressure to subdued demand and lower government spending on infrastructure projects, which led to under absorption of fixed costs and margin compression.

What drove the quarter: volumes at the parent, momentum at subsidiaries

Management commentary in the presentation places the quarter in a challenging environment. The CEO notes lower government spending on infrastructure projects including the water segment, and the ongoing geopolitical situation in the Middle East, which impacted demand, project execution and raw material supplies. This set the tone for lower revenue versus the previous year.

However, the group’s diversification showed up in the subsidiary numbers. Ravi Technoforge (RTL) reported revenue from operations of 97.35 crore in Q1 FY27 compared to 77.26 crore in Q1 FY26. RTL EBITDA increased to 13.05 crore from 9.38 crore, with EBITDA margin improving to 13.4 percent from 12.1 percent.

Ratnamani Finow Spooling Solutions (RFSS) recorded a significant jump in reported performance. RFSS revenue rose to 119.63 crore from 12.60 crore in the corresponding quarter of the previous year. EBITDA turned positive at 64.4 crore compared to -1.97 crore, and PAT came in at 49.02 crore compared to a loss of 6.20 crore.

Financial summary

Capacity additions: execution milestones in Kutch and Odisha

Even as the quarter reflected softer utilisation at the parent company, Ratnamani continued to add capability across carbon steel pipes and coating. During the quarter, the company completed the external coating facility at the Odisha plant and the HSAW manufacturing facility at the Kutch plant.

At Kutch, the parent company has established a new carbon steel HSAW spiral pipe facility. The presentation states it can produce pipes up to 18 metres in length with diameters ranging from 18 inches to 143 inches, and it has a production capacity of 1,00,000 MT. The project timeline is shown as completed in July 2026.

At Odisha, the company commissioned an external 3LPE coating plant to supplement the recently commissioned spiral welded pipes plant. The internal coating plant was put into operation last year, and the external 3LPE plant was commissioned in the quarter with a capacity of 25 lakh square metres per annum.

The presentation also states that the company remains debt free on a standalone basis and that the standalone order book increased to more than 2,000 crore.

Subsidiary expansion pipeline: near term scaling at RFSS and RTL

The group’s subsidiary strategy is backed by a set of expansions with stated timelines.

RFSS disclosed an active order book exceeding 300 crore and indicated it is targeting execution over the next 9 months. It is also undertaking a major infrastructure expansion to increase annual capacity from 1,400 MT to 4,000 MT through a facility over 52,000 square metres with advanced equipment. The company states the new capacity will be ready by Q3 of the year with commercial production commencing from Q4, while the broader project timeline is indicated as December 2026.

RTL is setting up a greenfield high speed hot forming facility at Rajkot to manufacture a new product line, including Gen 3 hubs and other drivetrain components for the automobile industry. The projected timeline is December 2026.

In addition, the presentation includes a longer dated project under Ratnamani Middle East Company, LLC in the Kingdom of Saudi Arabia for manufacturing cold finished stainless steel seamless products, with a timeline of March 2028 (revised).

Longer term context: financial history and ESG disclosures

In the annexures, the company reports consolidated revenue from operations of 4,493.96 crore for FY26 versus 5,186.47 crore in FY25. FY26 consolidated EBITDA is presented at 880 crore with an EBITDA margin of 19.6 percent, and consolidated PAT at 534 crore. On a standalone basis, FY26 revenue from operations is shown at 3,689.30 crore versus 4,876.14 crore in FY25, with FY26 EBITDA of 715 crore and standalone PAT of 434 crore.

Cash flow tables show FY26 operating cash flow of 936.01 crore consolidated and 976.12 crore standalone. However, investing outflows were large at 1,147.64 crore consolidated and 1,024.89 crore standalone, resulting in negative net cash flows of 152.41 crore consolidated and 154.70 crore standalone for FY26.

The ESG section highlights 52 MW of captive clean energy projects commissioned, 29 percent of total energy coming from clean sources, and manufacturing plants compliant with a ZLD mechanism.

Takeaways from Q1 FY27

Ratnamani’s Q1 FY27 reflects the cyclical nature of project linked pipe and tube businesses, where demand softness and lower utilisation can quickly compress standalone margins. The company has been direct in attributing the quarter’s pressure to subdued demand and lower government infrastructure spending, with geopolitical disruptions also cited as a factor.

At the same time, the consolidated numbers show the benefit of diversification. RTL delivered steady improvement, while RFSS reported a sharp jump in revenue and profitability and disclosed an order book of more than 300 crore. With the HSAW facility at Kutch and external coating capacity at Odisha now completed, the near term focus shifts to whether improved enquiry levels and order execution translate into higher volumes and better absorption of fixed costs in subsequent quarters.