Transcript of the conference call
KIRLFER · price
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Kirloskar Ferrous reported Q4 EBITDA of INR199 crores (up from INR181 crores YoY), though full-year FY25 EBITDA declined to INR758 crores from INR868 crores due to lower pig iron, tube and steel realizations. Pig iron sales volumes grew 22% YoY to 5.11 lakh tons and castings grew 10% to 1.32 lakh tons. Management guided FY26 targets of ~2 lakh tons in tubes, ~1.6 lakh tons in castings, and ~7 lakh tons of liquid metal production. Cost-saving projects (captive iron ore, solar power, PCI) are expected to improve margins, with solar benefits rising from INR40 crores to INR80 crores and captive iron ore benefits increasing ~5x. Power and fuel cost target is to bring it down from 6.7% to ~4%. Capex guided at INR500-600 crores for FY26, including a new Koppal steel furnace.
Mixed signals: Q4 saw margin recovery in pig iron due to cost-saving initiatives, but full-year EBITDA declined. Management is optimistic about FY26 driven by operational efficiencies, captive iron ore scale-up, and renewable energy benefits, with a target of 15% company-level EBITDA margin. Investors should watch for realization improvement in tubes and pig iron, which remain under pressure.