Ramkrishna Forgings reported a significant decline in profitability for the financial year ended March 31, 2026, with profit after tax (PAT) falling 78.47% year-on-year to ₹8,650.53 lakhs. The sharp drop contrasts with operational improvements, as EBITDA from operations increased by 15.75% to ₹56,642.88 lakhs, signaling that the profit erosion was primarily driven by non-operating factors rather than core business performance.

The company’s revenue from operations grew modestly by 3.32% to ₹3,75,492.46 lakhs in FY26, up from ₹3,63,429.92 lakhs in FY25. However, this top-line growth was unevenly distributed across geographies. Export sales contracted sharply by 19.94% to ₹1,18,655.36 lakhs, reflecting sluggish demand in key markets like North America due to tariff impacts. Conversely, domestic demand provided a buffer, with domestic segment revenues rising to ₹2,56,837.10 lakhs from ₹2,15,220.90 lakhs the previous year, aided by a 12.86% improvement in medium and heavy commercial vehicle (M&HCV) sales.

Financial Performance Breakdown

Despite the rise in EBITDA, the EBITDA margin compressed to 15.08% in FY26 from 13.46% in FY25 when calculated on net sales, though the Directors’ Report cites a margin of 15.33% against 16.81% previously. The primary drag on profitability was the surge in finance costs, which jumped 20.03% to ₹17,606.22 lakhs from ₹14,667.90 lakhs, attributable to an 11.8% increase in borrowings. Consequently, the interest coverage ratio declined slightly to 3.22x from 3.34x.

What the Numbers Show

A critical divergence exists between the company’s operating leverage and its bottom-line realization. While operating expenses as a percentage of net sales improved to 84.92% from 86.54%, indicating better cost control in production, this efficiency gain was entirely offset by higher interest outflows and exceptional items. Notably, the FY25 PAT figure included an exceptional gain of ₹10,287.33 lakhs from the sale of Globe All India Services Limited and a deferred tax credit of ₹18,847.91 lakhs related to the merger with ACIL Limited. Excluding these one-time benefits, the underlying operational profitability remains robust, but the current year’s results were further weighed down by a ₹4,204.84 lakhs provision for expected credit losses on trade receivables due to geopolitical disruptions and tariff uncertainties.

Capital Structure and Dividends

The company’s total net debt increased by 17.16% to ₹1,63,878.17 lakhs as of March 31, 2026, pushing the net debt-to-equity ratio to 0.50x from 0.46x. Shareholders’ funds grew by 8.79% to ₹3,27,477.87 lakhs, supported by proceeds from preferential warrant issuances. The Board declared an interim dividend of ₹1.00 per equity share, amounting to a cash outflow of approximately ₹1,818.35 lakhs, marking the final dividend for FY26.

Ramkrishna Forgings Limited will convene its 44th Annual General Meeting (AGM) on Saturday, 29 August 2026, at 11:30 A.M. (I.S.T.) through Video Conferencing/Other Audio-Visual Means (VC/OAVM). The meeting is critical for shareholders as it seeks approval for significant leadership transitions, including the re-appointment of Naresh Jalan as Managing Director and the elevation of Chaitanya Jalan to Joint Managing Director. Additionally, the agenda includes the ratification of cost auditor fees and the approval of excess remuneration for directors for the financial year 2025-26, following a period of subdued profitability driven by export challenges.

The notice, issued pursuant to Regulations 30 and 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, was dispatched electronically on 5 August 2026. Members whose email IDs are registered with the company, Registrar & Transfer Agent (RTA), or Depository Participants (DPs) received the notice directly. Those without registered emails will receive a letter containing web-links to access the AGM notice and the Annual Report for FY25-26, in compliance with Regulation 36(1)(b) of the SEBI Listing Regulations.

Key Agenda Items

The ordinary business includes the adoption of audited financial statements for the financial year ended 31 March 2026 and the re-appointment of directors retiring by rotation: Chaitanya Jalan and Milesh Gandhi.

Special business resolutions focus on leadership structure and compensation:

• Re-appointment of Managing Director: Shareholders are asked to approve the re-appointment of Naresh Jalan as Managing Director for three consecutive years, effective 5 November 2026. His tenure will last until 4 November 2029. This requires a special resolution under Sections 196, 197, and 198 of the Companies Act, 2013.
• Redesignation of Chaitanya Jalan: The board proposes redesignating Chaitanya Jalan from Whole-time Director to Joint Managing Director, effective 24 July 2026, until the end of his current term on 8 November 2029. His remuneration terms remain unchanged from those approved in the 42nd AGM.
• Cost Auditor Ratification: The meeting will ratify the remuneration of M/s. Bijay Kumar & Co., Cost & Management Accountants, for the financial year ending 31 March 2027. The fee is set at ₹ 5,00,000 plus GST and out-of-pocket expenses.
• Excess Remuneration Approval: Due to inadequate profits in FY25-26—attributed to a 20% decline in exports caused by US tariffs and weak domestic demand in the first half—the company seeks approval for paying ₹ 510 Lakhs in commission to directors, exceeding limits prescribed under Section 197(1) of the Companies Act, 2013.

Director Remuneration Details

The proposed excess remuneration for FY25-26 is distributed among the directors as follows:

Note: Partha Sarathi Bhattacharyya and Sandipan Chakravorty ceased to be independent directors effective 21 May 2026, upon completion of their second term.

E-Voting and Meeting Logistics

The cut-off date for determining voting eligibility is Saturday, 22 August 2026. Remote e-voting will be open from Wednesday, 26 August 2026 (9:00 A.M.) to Friday, 28 August 2026 (5:00 P.M.). Shareholders can vote via NSDL, CDSL, or the KFin Technologies Limited platform. The register of members and share transfer books will remain closed from 23 August 2026 to 29 August 2026.

What the Numbers Show

The company’s financial performance in FY25-26 reflects external headwinds. Revenue stood at ₹ 3,75,492.46 Lakhs, a modest increase from ₹ 3,63,429.92 Lakhs in FY24-25. However, net profit after tax declined sharply to ₹ 8,650.53 Lakhs from ₹ 40,182.01 Lakhs in the previous year. This divergence between top-line growth and bottom-line contraction underscores the impact of margin pressure from export tariffs and domestic demand stagnation, necessitating the shareholder approval for excess director remuneration despite lower profitability.