Ramkrishna Forgings Ltd (RKFORGE) AI Stock Analysis

• Market Cap: ₹90.24B
• Dividend Yield: 0.38%
• Average Volume (3M): 32.58K
• Price to Earnings (P/E): 174.3
• Beta (1Y): 1.26
• Revenue Growth: -4.73%
• EPS Growth: -19.52%
• Country: IN
• Employees: 2,554
• Sector: Industrials
• Sector Strength: 72
• Industry: Manufacturing - Tools & Accessories
• EPS (TTM): 1.05
• Shares Outstanding: 181,030,610
• 10 Day Avg. Volume: 29,722
• 30 Day Avg. Volume: 32,581
• PEG Ratio: 3.68
• Price to Book (P/B): 4.61
• Price to Sales (P/S): 3.47
• P/FCF Ratio: -12.67
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 13.4
• Revenue Forecast (FY): ₹35.59B

• Rating: 54 Neutral
• Price Target: ₹544.00 ▲(9.52% Upside)
• Action: Reiterated Date: 12/18/25
• Date: Action: Reiterated 12/18/25

Ramkrishna Forgings Ltd faces significant challenges with cash flow issues and bearish technical indicators. While the company has shown strong revenue growth and profitability, the high P/E ratio and low dividend yield limit its attractiveness. Addressing cash flow and operational efficiency is crucial for sustaining growth.

Positive Factors

High gross margins

Sustained gross margin of ~44% indicates efficient forging and downstream processing. High manufacturing margins provide durable buffer against raw-material swings, support reinvestment in capacity/quality, and underpin long-term profitability even if top-line growth moderates.

Value-added, safety-critical supplier position

Supplying safety-critical drivetrain and suspension components with integrated machining creates high switching costs and multi-year program ties to OEMs. This entrenched supplier role supports predictable order streams, pricing power on value-added work, and durable customer relationships.

Moderate leverage with solid ROE

A 0.7 D/E and ~14% ROE reflect a balanced capital structure and decent capital efficiency. Moderate leverage gives room to fund working capital and capex without extreme default risk, while ROE shows the business can generate reasonable returns on shareholder capital over time.

Negative Factors

Negative operating and free cash flow

Reported profits alongside negative operating and free cash flow point to working-capital strain, elevated receivables or capex, and potential liquidity pressure. Persistent cash deficits can restrict capex, limit debt service capacity, and force dilutive financing absent corrective actions.

Declining EBIT margin and recent revenue softness

Eroding EBIT margin and recent top-line softness indicate margin compression and weaker demand or pricing power. Over time this reduces cash generation and reinvestment capacity, requiring operational fixes or product mix improvement to restore durable profitability trends.

Cyclicality and raw-material/currency exposure

Heavy exposure to automotive/CV cycles and steel price volatility creates structural revenue and margin swings. Export and currency risk add unpredictability to cash flows and planning. This cyclical sensitivity can prolong recovery during industry downturns and complicate multi‑period forecasting.

Ramkrishna Forgings Ltd Business Overview & Revenue Model

Company Description

Ramkrishna Forgings Limited manufactures and supplies open and closed die forgings of carbon and alloy steel, micro alloy steel, and stainless steel in India and internationally. It operates in two segments, Forging Components and Others. The company offers crown wheels/ring gears; I beams, crankshafts, connecting rods, knuckles, diff cases, center wedges, steering arms, tie rod arms, pitman arms, stub axles, recondition taper stationary plates, spides/crosses, brake flanges, brackets, wheel hubs, yokes, front engine mounting arms, tooth products, hammer bars, track links, bearing caps, counterweights, and ring gear carriers; and pinions, front hubs, prop shafts, counter shafts, rear axle shafts, coupling flanges, engaging gears, CM gears, speed gears, and clutch collars. It also provides screw couplings, bolster suspensions, side frame keys, and draw gear assemblies, as well as tour and travel services. The company offers its products for various industries and sectors, including automotive, earth moving and mining, farm equipment, general engineering, railways, steel plants, and oil exploration, as well as for OEMs. Ramkrishna Forgings Limited was incorporated in 1981 and is headquartered in Kolkata, India.

How the Company Makes Money

RKFORGE makes money by manufacturing and selling forged (and value-added machined) components to original equipment manufacturers (OEMs) and tiered component suppliers. Its primary revenue stream is product sales: customers place orders for specific part numbers/specifications, and RKFORGE earns revenue per unit shipped (or per contract/lot), with pricing generally reflecting raw-material inputs (notably steel), forging complexity, machining/finishing requirements, quality/testing requirements, volumes, and delivery terms. A meaningful part of the value capture typically comes from value addition beyond basic forging—such as machining, heat treatment, surface finishing, and assembly-ready processing—allowing the company to realize higher realization per component versus supplying only rough forgings. Revenue is also supported by repeat programs tied to vehicle and industrial platforms where components are qualified once and then supplied over multi-year model/contract cycles, creating ongoing order flow subject to end-market demand. Exports contribute to earnings through sales to international customers, with realized revenue influenced by currency movements, logistics costs, and global demand cycles. Specific details on revenue split by segment/customer, named partnerships, contract structures (e.g., long-term supply agreements), and service/other income are null.

Ramkrishna Forgings Ltd Financial Statement Overview

Summary

Ramkrishna Forgings Ltd shows strong revenue growth and profitability, but recent declines in EBIT margin and revenue growth rate pose challenges. The balance sheet reflects moderate leverage with stable equity, but significant cash flow issues could impact future operations and growth.

Income Statement

Ramkrishna Forgings Ltd has shown a consistent revenue growth over the years, although the latest year saw a slight decline of 1.76%. The gross profit margin remains strong at 43.74%, indicating efficient production processes. However, the net profit margin is relatively modest at 10.29%, suggesting room for improvement in cost management. The EBIT margin has decreased to 7.41%, reflecting potential challenges in operational efficiency.

Balance Sheet

The company's debt-to-equity ratio of 0.70 indicates a moderate level of leverage, which is a positive sign compared to previous years. Return on equity stands at 13.66%, showing decent profitability relative to shareholder investments. The equity ratio is stable, suggesting a balanced capital structure, but there is potential risk if debt levels increase.

Cash Flow

The cash flow situation is concerning, with negative operating and free cash flows in the latest year. The operating cash flow to net income ratio is negative, indicating cash flow issues despite reported profits. The free cash flow to net income ratio is unusually high due to negative free cash flow, highlighting potential liquidity challenges.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	39.44B	40.34B	37.05B	31.93B	23.20B	12.89B
Gross Profit	16.01B	17.64B	15.92B	13.75B	9.90B	5.44B
EBITDA	3.67B	5.39B	7.64B	6.98B	5.16B	2.23B
Net Income	1.47B	4.15B	2.91B	2.48B	1.98B	206.68M
Balance Sheet
Total Assets	68.87B	65.57B	53.08B	37.30B	34.84B	27.04B
Cash, Cash Equivalents and Short-Term Investments	753.58M	290.49M	2.28B	555.92M	1.21B	710.82M
Total Debt	27.22B	21.26B	12.07B	13.33B	16.33B	12.33B
Total Liabilities	38.19B	35.20B	26.24B	24.09B	24.05B	18.22B
Stockholders Equity	30.68B	30.37B	26.84B	13.22B	10.78B	8.83B
Cash Flow
Free Cash Flow	-4.90B	-11.06B	319.24M	3.89B	-2.57B	-913.55M
Operating Cash Flow	-53.92M	-1.29B	6.21B	7.45B	430.57M	1.40B
Investing Cash Flow	-4.82B	-9.14B	-11.17B	-2.99B	-3.54B	-2.22B
Financing Cash Flow	5.08B	8.86B	6.25B	-4.38B	2.80B	1.47B

Ramkrishna Forgings Ltd Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 496.70
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:RKFORGE, the sentiment is Negative. The current price of 496.7 is below the 20-day moving average (MA) of 547.07, below the 50-day MA of 537.30, and below the 200-day MA of 565.66, indicating a bearish trend. The MACD of -5.23 indicates Positive momentum. The RSI at 31.25 is Neutral, neither overbought nor oversold. The STOCH value of 9.70 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:RKFORGE.

Ramkrishna Forgings Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SONACOMS	74 Outperform	₹314.69B	49.42	―	0.65%	7.34%	2.27%
MMFL	72 Outperform	₹20.65B	24.91	―	1.07%	-4.47%	-17.62%
JASH	65 Neutral	₹23.27B	51.58	―	0.47%	25.52%	-4.18%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
JTEKTINDIA	61 Neutral	₹35.16B	48.24	―	0.49%	4.44%	-25.67%
PENIND	61 Neutral	₹19.28B	20.56	―	―	14.73%	21.44%
RKFORGE	54 Neutral	₹90.24B	174.30	―	0.38%	-4.73%	-19.52%

Ramkrishna Forgings Ltd Corporate Events

Ramkrishna Forgings Posts Q3 and 9M FY26 Earnings Call Audio on Website

Ramkrishna Forgings Limited has notified the stock exchanges that the audio recording of its Q3 and nine-month FY 2025-26 earnings conference call with analysts and investors, held digitally on 27 January 2026, has been made available on the company’s website. The disclosure, made under SEBI’s listing regulations, enhances transparency for shareholders and market participants by providing convenient public access to management’s latest financial commentary and outlook-related discussion on the firm’s recent performance.

Ramkrishna Forgings Files SEBI Compliance Certificate on Demat Activity for Q3 FY2025

Ramkrishna Forgings Limited has submitted to the stock exchanges a certificate from its registrar and transfer agent, KFin Technologies Limited, confirming compliance with Regulation 74(5) of the SEBI (Depositories and Participants) Regulations, 2018 for the quarter ended December 31, 2025. The filing confirms that details of securities dematerialised and rematerialised during the period have been duly furnished to all stock exchanges where the company’s shares are listed, underscoring ongoing regulatory compliance in its share transfer and depository processes for stakeholders.