Ramkrishna Forgings (RKFORGE) Q4 11/12 earnings summary

Executive summary

• FY12 net sales rose 22.35% to ₹501.26 crore; EBITDA increased 15.41% to ₹81.70 crore and PAT rose 10.06% to ₹24.28 crore. Forging production reached full capacity utilisation.

• Growth was supported by higher forging output and improved ring-rolling performance, while the near-term commercial vehicle outlook was subdued amid weak industrial activity and fleet-operator economics.

Financial highlights

• Net sales increased 22.35% to ₹501.26 crore from ₹409.68 crore; total revenue was ₹501.92 crore, including ₹0.65 crore other income.

• PBT rose 7.60% to ₹35.84 crore; PAT increased 10.06% to ₹24.29 crore from ₹22.06 crore. Finance costs were ₹18.79 crore, up from ₹16.49 crore.

• Cash profit increased 16.07% to ₹52.21 crore; basic EPS rose to ₹13.61 from ₹13.43, while diluted EPS was ₹13.61 versus ₹13.06.

• Raw-material costs rose to ₹287.24 crore and power and fuel costs to ₹46.48 crore; total costs excluding interest and depreciation rose 22.67% to ₹429.77 crore.

Outlook and guidance

• Near-term vehicle demand outlook was subdued; M&HCVs faced greater pressure, while LCV demand was expected to benefit from hub-and-spoke logistics, improved connectivity and rural demand.

• Over the next five years, industry volume growth was projected at 9.5–11.5% CAGR for M&HCVs and 11–13% for LCVs.

• Management cited export customer additions in Mexico and Turkey and planned focused overseas marketing to support future exports.