Ramkrishna Forg. Q1 FY27 Results (NSE: RKFORGE)
Signal: Margin expansion
The read
Revenue stagnated sequentially at ₹1,217 Cr but EBITDA margin improved for the 3rd straight quarter (332bps YoY expansion to 17.96%) on operating leverage and mix. PAT, however, fell 16.2% QoQ despite EBITDA rising, pointing to hidden costs or minority drag; consolidated PAT of ₹47 Cr vs standalone PAT of ~₹370 Cr (per earlier reports) signals heavy subsidiary losses. The 170 Cr capex for PV components and a 4000T press line reinforces the long-term growth narrative, but near-term earnings quality is obscured by the standalone-consolidated gap.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹1,217 Cr | 19.8% | 0.0% |
| EBIT | ₹218 Cr | 47.0% | |
| Net profit | ₹47 Cr | 297.6% | |
| EPS | ₹2.57 | 295.4% | |
| EBIT margin | 17.96% |
P&L walk
Revenue flat QoQ at ₹1,217 Cr but up 19.8% YoY; EBITDA margin expanded 332bps YoY to 17.96% on operating leverage and better mix; PAT fell 16.2% QoQ due to higher finance costs/other expenses, though up 297.6% YoY from a low base; EPS growth (295.4%) tracks PAT.
Segments
No segment break-up provided; single-segment (forged/machined products) implied.
Key positives
- EBITDA margin expanded 332bps YoY to 17.96% — 3rd consecutive quarter of margin expansion after a prolonged contraction phase.
- Revenue grew 19.8% YoY, driven by firm domestic demand and healthy export volumes.
- PAT up 297.6% YoY from a low base; PBT improved to ₹65 Cr vs ₹24 Cr in Q1FY26.
- Management highlighted scaling of railways, oil & gas, mining segments and casting operations as new growth drivers.
Key concerns
- Consolidated PAT of ₹47 Cr is vastly lower than standalone PAT of ~₹370 Cr (per earlier reports), indicating heavy subsidiary losses that cloud group profitability.
- PAT fell 16.2% QoQ despite EBITDA growing 4.9% QoQ — finance costs or other items eroded sequential gains.
- QoQ revenue was flat (0% growth) at ₹1,217 Cr, suggesting near-term momentum may have stalled.
- P/E of 98.18x vs industry 30.91x continues to price in high growth expectations that quarterly execution must meet.
Research and educational content only. Not investment advice.