Check Before You Invest : Ramkrishna Forgings Ltd

BSE: 532527 NSE: RKFORGE ISIN: INE399G01023

| Sector: Automobiles | Industry: Forgings

Snapshot

Q.1 Which industry/sub-sector does Ramkrishna Forgings Ltd belong to?

Ramkrishna Forgings Ltd belongs to the Automobiles sector, operating specifically within the Forgings segment.

Q.2 Is Ramkrishna Forgings Ltd a good quality company?

Ramkrishna Forgings Ltd is a average quality company, based on a somewhat consistent 10-year financial track record.

Q.3 Is Ramkrishna Forgings Ltd undervalued or overvalued?

Ramkrishna Forgings Ltd appears Fair, as its key valuation ratios are in line with their past averages.

Q.4 Is Ramkrishna Forgings Ltd a good buy now?

Ramkrishna Forgings Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Performance Analysis

Q.1 Revenue growth of Ramkrishna Forgings Ltd?

Ramkrishna Forgings Ltd revenue growth is 2% for FY-2025, which is below its 5-year CAGR of 27.1%, indicating slower growth.

Q.2 Return on capital employed (ROCE) of Ramkrishna Forgings Ltd?

Ramkrishna Forgings Ltd Return on capital employed is 7.12% for FY-2025, which is below its 5-year historical median of 14.66%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 13.5%, indicating value preservation.

Q.3 Return on Asset of Ramkrishna Forgings Ltd?

Ramkrishna Forgings Ltd Return on Asset is 5.55%, which is below its 5-year historical median of 6.35%, indicating deteriorated asset utilization efficiency.

Q.4 Return on Equity (ROE) of Ramkrishna Forgings Ltd?

Ramkrishna Forgings Ltd Return on equity is 11.66% for FY-2025, which is below its 5-year historical median of 17.22%, indicating the business is making worse use of its shareholders capital.

Q.5 Cash conversion cycle of Ramkrishna Forgings Ltd?

Ramkrishna Forgings Ltd Cash conversion cycle is 141 days, in line with its 5-year historical median of 141 days, indicating stable working capital management. However, you need to compare this with its peers in the industry.

	Current Level	5-year Historic Median
Asset Turnover	0.68	0.74
ROE	11.66	17.22
ROCE	7.12	14.66
Cash Conversion Cycle	141 days	141 days

Q.6 Gross Profit margin of Ramkrishna Forgings Ltd?

Ramkrishna Forgings Ltd Gross profit margin which is the profit after deduction of direct costs, is 10.4% for FY-2025, which is below its 5-year median of 18%, indicating decreasing margins.

Q.7 Operating Profit Margin of Ramkrishna Forgings Ltd?

Ramkrishna Forgings Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 14.17% for FY-2025, which is below its 5-year median of 21.31% indicating decreasing margins.

Q.8 Net Profit Margin of Ramkrishna Forgings Ltd?

Ramkrishna Forgings Ltd Net Profit Margin is 8.22% for FY-2025, is in line with with its 5-year median of 8.22%, indicating stable margins.

	Current Level	5-year Historic Median
Gross Profit Margin	10.4	18
Operating Profit Margin	14.17	21.31
Net Profit Margin	8.22	8.22

Q.9 Debt to Equity ratio of Ramkrishna Forgings Ltd?

Ramkrishna Forgings Ltd Debt-to-Equity ratio is 0.67, which is above with the industry average of 0.49, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Ramkrishna Forgings Ltd?

Ramkrishna Forgings Ltd Debt to cash flow from operations is 61.84, which is at a unhealthy level.

Ownership & governance

Q.1 Promoter shareholding and pledge status of Ramkrishna Forgings Ltd?

Promoters hold 43.33% of the Ramkrishna Forgings Ltd, with 15.63% of their stake pledged, indicating high pledge risk.

Peer comparison (industry-wise, mcap)

Q.1 Revenue growth of Ramkrishna Forgings Ltd vs industry peers?

Ramkrishna Forgings Ltd revenue CAGR is 27.10%, compared to the industry median CAGR of 14.05%, indicating faster growth and gaining its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth	2	14.1
Gross Profit Growth	-41.4	25.5
Operating Profit Growth	-33.4	18.7
Net Profit Growth	-2.6	27.4

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover	0.68	0.92
ROE	11.66	15.17
ROCE	7.12	14.66
Cash Conversion Cycle (days)	140.75	112

Valuation & price assessment

Q.1 Stock return of Ramkrishna Forgings Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of 22.3% based on the current price.

Q.2 What return has the stock given over the last decade?

	9Y	5Y	3Y	1Y
Share Price CAGR	22.3%	40%	21.6%	2.2%

Q.3 Valuation ratios of Ramkrishna Forgings Ltd vs historical?

The current P/E is higher that its historical median.

Q.4 How do the current valuation ratios compare with 5-year historical median and industry numbers?

Valuation Ratios	Current	5-year Historic Median	5-year Industry Median
Price to Earnings	154.18	30.52	33.04
Price to Book	3.36	3.77	3.77
Price to Sales	2.61	2.58	1.87
EV to EBITDA	20.19	16.86	16.81

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