Ramkrishna Forgings Limited, a leading Indian forging company, reported a consolidated loss of Rs. 9.5 crores in the second quarter of fiscal year 2026, primarily due to forex losses and tariff impacts. The company's revenue declined by 10.6% to Rs. 907.53 crores compared to the previous quarter, reflecting the challenging global business environment.

Key Financial Highlights

• Revenue: Rs. 907.53 crores (down 10.6% quarter-on-quarter)
• EBITDA: Rs. 122.54 crores (excluding other income, down 17.5% quarter-on-quarter)
• EBITDA Margin: 13.5% (down 110 basis points from Q1 FY26)
• Net Loss: Rs. 9.5 crores

Factors Impacting Q2 Performance

The company's performance was affected by several factors:

1. Forex losses of Rs. 6.77 crores on imported equipment
2. Tariff impact of Rs. 10.75 crores
3. Loss of Rs. 3.00 crores from Mexico operations
4. Loss of Rs. 4.84 crores from joint venture operations

New Order Wins

Despite the challenging quarter, Ramkrishna Forgings secured new orders worth Rs. 1,116 crores with a program life of 4 years. The order breakdown is as follows:

Management Commentary

Mr. Naresh Jalan, Managing Director of Ramkrishna Forgings, stated, "The worst is behind us. We are confident that the third and fourth quarters will be extremely surprising and on the upside of the results."

Future Outlook

The company expects significant recovery in the second half of FY26:

1. Domestic market showing strong traction post-GST cut
2. New customer wins in North America and oil & gas sectors
3. Railway segment gaining momentum with orders for fully finished assembled bogey frames
4. Casting facility expected to reach 80-85% utilization in FY27

Debt Reduction Plans

The company plans to reduce its debt by Rs. 500-600 crores by March 2026, supported by improved cash flows and promoter infusion.

Conclusion

While Ramkrishna Forgings faced headwinds in Q2 FY26, the management remains optimistic about the company's prospects for the second half of the fiscal year. The diversification strategy and new order wins are expected to drive growth and improve financial performance in the coming quarters.

Investors and stakeholders will be closely watching the company's execution of its plans and the realization of projected improvements in the next two quarters.

Ramkrishna Forgings Limited , a key player in the forging industry, has announced plans to raise ₹199.92 crore through a preferential issue of convertible warrants. The company's board has approved the issuance of 34,00,000 fully convertible warrants to promoter Chaitanya Jalan at ₹588 per warrant.

Key Details of the Preferential Issue

• Number of Warrants: 34,00,000
• Issue Price: ₹588 per warrant
• Total Fundraise: ₹199.92 crore
• Allottee: Chaitanya Jalan (Promoter)
• Conversion Ratio: Each warrant is convertible into 1 equity share of face value ₹2

Utilization of Funds

The company plans to use the proceeds for the following purposes:

1. Debt Repayment: Approximately ₹149.94 crore will be used for repayment or pre-payment of outstanding borrowings.
2. General Corporate Purposes: Up to 25% of the issue proceeds (approximately ₹49.98 crore) will be used for general corporate purposes.

Impact on Shareholding

Post-issue, assuming full conversion of warrants:

• Chaitanya Jalan's shareholding will increase from 1.67% to 3.48%
• Total promoter and promoter group shareholding will rise from 43.43% to 44.47%

Key Terms and Conditions

• The warrants will be convertible into equity shares within 18 months from the date of allotment.
• 25% of the warrant price will be payable at the time of subscription, with the balance due at the time of conversion.
• The issue price of ₹588 per warrant is higher than the minimum price calculated as per SEBI ICDR Regulations.

Regulatory Compliance

• The preferential issue is subject to shareholder approval at an Extraordinary General Meeting (EGM) scheduled for December 12, 2025.
• India Ratings & Research Private Limited has been appointed as the Monitoring Agency to oversee the use of proceeds, as required by SEBI regulations for issues exceeding ₹100 crore.

Management Commentary

While specific management quotes were not provided, the company's decision to raise funds through a preferential issue to a promoter indicates confidence in the company's future prospects and a commitment to strengthening its financial position.

This strategic move by Ramkrishna Forgings is expected to improve its debt-equity ratio and provide financial flexibility for future growth initiatives.