Ramkrishna Forgings Limited has informed the Exchange about Transcript
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Ramkrishna Forgings disclosed its Q4 FY25 earnings call transcript, reporting full-year consolidated revenue of Rs. 4,034 Crores (up 9% YoY) but EBITDA falling to Rs. 560 Crores from Rs. 770 Crores in FY24. The company revealed a major inventory discrepancy of Rs. 270 Crores (Rs. 220 Crores in FY25 and Rs. 50 Crores in FY24) caused by erroneous production entries and non-recording of rejections, leading to a net adverse impact of ~Rs. 202 Crores (6.73% of net worth). To bridge the shortfall, the Board approved issuance of 9,75,000 warrants to promoters at Rs. 2,100 each, totalling Rs. 204.75 Crores, with the full amount expected before March 2026. The company won new orders worth Rs. 4,600 Crores during FY25 (Rs. 710 Crores in Q4) and maintained its aspirational 24-25% EBITDA margin target for FY28 along with 15-20% revenue growth guidance for FY26. India Ratings upgraded the company's long-term rating to IND AA/Stable.
The inventory discrepancy disclosure is a negative overhang that may pressure the stock in the short term due to governance concerns, but the prompt promoter commitment to fund the shortfall, rating upgrade, and reaffirmed long-term margin and growth targets provide support. Shareholders can expect substantial debt reduction by FY26 end and resolution of the inventory issue within the next 3-6 months, though near-term margins will remain under pressure.