Ramkrishna Forgings (RKFORGE) Q1 24/25 earnings summary

Executive summary

• Achieved steady results in Q1 FY2025, with optimism for future growth driven by robust global forging market trends, strong order inflows of Rs. 1,679 crore, and diversification into non-auto segments.

• Board approved merger of ACIL Limited and acquisition of Resortes Libertad, S.A. de C.V. in Mexico, enhancing global footprint and operational synergies.

• Strategic focus on innovation, operational excellence, partnerships, expanding manufacturing capacity, and increasing EV business share.

• Approved unaudited standalone and consolidated financial results for Q1 FY25, with Board and Audit Committee review and unmodified auditor conclusions.

• Re-appointed Singhi & Co. as internal auditors for FY25 and Mr. Chaitanya Jalan as Whole-time Director for five years, subject to shareholder approval.

Financial highlights

• Q1 FY2025 consolidated revenue reached Rs. 1,00,502 lakhs (INR 868.5 crore), up 3-4% year-over-year; standalone revenue at Rs. 86,846 lakhs, up 3.9% YoY.

• Adjusted EBITDA margin at 23.1% (excluding INR 17.5 crore one-off), up 70 bps YoY; consolidated EBITDA margin at 22.4%.

• Net profit after tax for Q1 FY25 was Rs. 8,090 lakhs (INR 73.1 crore), with PAT margin at 8.0%.

• Export revenue share increased to 44.3% in Q1FY25 from 42.5% in FY24.

• Domestic revenue declined 3% YoY due to lower offtake and raw material price decreases.

Outlook and guidance

• Confident in sustaining EBITDA margins above 23% in coming quarters.

• Volume growth guidance of 15%-20% for FY2025 remains on track, supported by strong order book visibility.

• Capacity expansion to 308,400T by end of FY25, with new press lines and cold forging capabilities coming online.

• Machining and warehousing operations in Mexico to commence from Q3FY25, backed by a long-term $3.5 million per annum agreement.

• Strategic focus on global market expansion, non-auto diversification, and EV segment growth.