Ramkrishna Forgings Ltd (RKFORGE) AI Stock Analysis

• Market Cap: ₹94.04B
• 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 margin

A sustained gross margin of 43.74% implies efficient core forging operations and cost-effective production. This margin breadth supports downstream value-add activity (machining/finishing), provides pricing flexibility against raw-material swings, and underpins durable unit-level profitability.

Moderate leverage

A 0.70 debt/equity ratio suggests a balanced capital structure that limits refinancing stress and preserves financial flexibility. Moderate leverage supports funding of working capital and capex needs without excessively increasing fixed finance costs, aiding resilience across cycles.

Decent return on equity

ROE around 13.7% signals the company generates reasonable returns on shareholder capital, reflecting operational competence and acceptable capital allocation. Over the medium term, this level supports reinvestment into manufacturing capability and program qualifications with disciplined capital deployment.

Negative Factors

Negative operating cash flow

Reported negative operating and free cash flows despite accounting profits indicate working-capital strain or cash conversion issues. Persistent cash deficits reduce ability to self-fund capex, pay down debt, or finance growth, increasing reliance on external funding and elevating liquidity risk over months.

Compressing EBIT margin

A falling EBIT margin to 7.41% points to margin pressure from higher operating costs or pricing challenges. Over 2–6 months this erodes operating cash generation and reduces buffer against raw-material or labor inflation, making sustained investment and competitive pricing harder without efficiency gains.

Weakening revenue trend

Negative revenue growth metrics (-4.5% year figure; latest year -1.76%) suggest demand softness or program timing headwinds. A declining top line constrains operating leverage, limits scale benefits in forging and machining, and makes margin recovery and consistent cash generation more difficult.

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 550.62, below the 50-day MA of 537.82, and below the 200-day MA of 566.20, indicating a bearish trend. The MACD of -1.57 indicates Positive momentum. The RSI at 37.25 is Neutral, neither overbought nor oversold. The STOCH value of 15.31 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	₹309.62B	49.42	―	0.65%	7.34%	2.27%
MMFL	72 Outperform	₹20.44B	24.91	―	1.07%	-4.47%	-17.62%
JASH	65 Neutral	₹22.97B	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	₹35.26B	48.24	―	0.49%	4.44%	-25.67%
PENIND	61 Neutral	₹18.81B	20.56	―	―	14.73%	21.44%
RKFORGE	54 Neutral	₹94.04B	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.

Ramkrishna Forgings Reports No Physical Share Re-lodgement Requests in November 2025

Ramkrishna Forgings Limited has notified the stock exchanges that, in line with a Securities and Exchange Board of India (SEBI) circular on re-lodgement of transfer requests for physical shares, it has received a report from its registrar and transfer agent, Kfin Technologies, for the month ended 30 November 2025. The report confirms that there were no shareholder requests for re-lodgement of transfer of physical shares under the special SEBI window during the month, indicating no pending or processed cases in this category and suggesting administrative stability in the company’s share transfer and dematerialisation processes.

CRISIL Removes Watch, Reaffirms Ramkrishna Forgings at ‘AA-/Negative’ and ‘A1+’ Amid Export Headwinds

Ramkrishna Forgings Limited has had its long-term rating reaffirmed at ‘CRISIL AA-/Negative’ and short-term rating at ‘CRISIL A1+’, with both removed from watch, covering Rs 1,650 crore of bank facilities and Rs 300 crore of commercial paper. CRISIL’s action follows management’s corrective measures to tighten internal controls over inventory reporting, completion of an external fact-finding review that found no further discrepancies beyond those booked in fiscal 2025, and a planned promoter-backed compensation of Rs 204.75 crore via convertible warrants, part of which has already been infused. However, the negative outlook reflects weaker-than-expected operating efficiency and capital structure amid a slowdown in the commercial vehicle industry, lower export contribution due to US customs duties, and potential demand and margin risks from new Mexican duties on Indian exports, all of which remain key monitorables for the company and its lenders.