Ramkrishna Forgings (RKFORGE) Q2 24/25 earnings summary

Executive summary

• Achieved record quarterly revenue and profit growth, driven by new product launches, increased business share, and significant order inflow of Rs. 1,522 crore to be executed over four years.

• Integration of recent acquisitions and completion of Resortes Libertad, S.A. de C.V. acquisition in Mexico, with a focus on streamlining the corporate structure and expanding global presence.

• Divested 100% stake in Globe All India Services for INR 128 crore, redeploying funds into core growth initiatives.

• Significant CapEx investments in aluminum forging (3,000 tons), cold forging, and upsetter capacity, with board approval for Rs. 57.5 crore targeting the EV segment.

• Declared 1st interim dividend of ₹1 per share for FY25 and increased paid-up capital through ESOP allotment.

Financial highlights

• Consolidated revenue for Q2 FY25 reached INR 1,053.60 crore, up 17.2% year-on-year; H1 FY25 consolidated revenue at INR 2,01,311 lakhs, up 16.0% YoY.

• EBITDA for Q2 FY25 stood at INR 232.75 crore, a 16.2% YoY increase; EBITDA margin at 22.09%.

• Profit after tax (including exceptional items) was INR 189.77 crore, up 130% YoY, aided by a major gain from the sale of a subsidiary.

• Export revenue grew 9.4% YoY in H1 FY25, now comprising 45% of total revenue.

• Standalone and consolidated EPS improved significantly in Q2 and H1 FY25.

Outlook and guidance

• Confident in achieving 15%-20% year-on-year growth, with volume growth target of 15% for the full year.

• Capacity expansion to 311,400T by Q1FY26, with new hot, cold, and aluminium forging lines; focus on global market expansion, EV, and non-automotive diversification.

• Rail wheel project JV with Titagarh progressing, operations expected by Jan FY26.

• Mexico facility to start machining and warehousing in Q3FY25, backed by long-term agreement.

• Expecting further improvement in EBITDA margin as integration and ramp-up of new initiatives progress.