Revision of credit ratings of the Company by India Ratings & Research
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▲ positive · ▼ negative · ● neutral filings · teal = economic event · numbered = multiple that day (click to pick). Times IST.
India Ratings & Research downgraded Ramkrishna Forgings' long-term credit rating from 'IND AA' to 'IND AA-' with a Stable Outlook, while affirming the short-term rating at 'IND A1+'. The downgrade was triggered by weak credit metrics in FY26, with adjusted consolidated net leverage rising to 4.64x due to ongoing capex and a moderation in EBITDA margins. The company also disclosed a material inventory overstatement of INR 2,026 million (net after tax) discovered during an FY25 audit, affecting work-in-progress, raw materials, and scrap across FY24 and FY25. Consolidated revenue grew 5.1% to INR 42,381 million in FY26, and total debt (including LC acceptances) rose to INR 31,438 million. The rating agency expects leverage to improve to 3.5-4x in FY27, aided by promoter warrant infusion of INR 2,028 million and tax refunds.
The downgrade signals elevated credit risk due to high leverage and the inventory accounting issue, which may raise borrowing costs and concerns among lenders and investors. While the Stable Outlook and 'AA-' rating still reflect investment-grade quality, the negative free cash flow and elevated debt levels warrant caution.