Thank you. Welcome to all the participants on behalf of 360 ONE Capital Market for Ramkrishna Forgings Limited 1Q FY27 post-results conference call.

From the management, we have with us today Mr. Naresh Jalan, Managing Director; Mr.

Chaitanya Jalan, Whole-time Director; Mr. Lalit Khetan, Whole-time Director and CFO; Mr.

Milesh Gandhi, Whole-time Director; and Mr. Rajesh Mundhra, Vice President Finance and Corporate Secretary.

I will now hand over the call to the management for the opening remarks, to be followed by the question-and-answer session. Over to you, sir.

Thank you, Dinesh. Good evening, everyone, and thank you for joining us on this call to discuss the Q1 FY27 earnings.

I trust all of you have a chance to review the earnings document that we have shared earlier today. The global macroeconomic environment remained mixed during the quarter, with geopolitical developments and evolving trade policies continuing to shape business sentiment across major markets.

While the resurgence of the West Asia conflict remains an overhang and tariff regulation can arise once again, operating conditions have become more stable compared with the heightened volatility which we witnessed over the past few quarters. While customer activity across key markets has remained resilient, demand across the commercial vehicle ecosystem has strengthened further, supported by healthy production schedules and greater policy clarity around regional supply chains.

Robust GST collections and healthy consumption trends reflect the underlying strength of the domestic economy. Reflecting these favorable market conditions, we are pleased to report another quarter of strong operational and financial performance.

The momentum established in the latter half of FY26 has carried into the first quarter of FY27, driven by robust domestic demand, improving export volume, and disciplined execution across our increasingly diversified business portfolio. Our international business recorded further improvement during the quarter, led by stronger demand from North America, alongside improving customer engagement and order execution across Europe.

While tariff-related developments remain an area of close attention, the operating environment has become considerably more stable, providing greater visibility and confidence across our export markets. At the same time, we are expanding our presence across passenger vehicles, electric vehicles, and advanced materials, including aluminum and specialty alloy forgings, broadening our addressable market and creating new avenues for long-term growth.

Operationally, the quarter witnessed continued progress across several strategic priorities. The integration of our casting operations has now been substantially completed, and we remain focused on scaling production while improving operating efficiencies.

Production ramp-up across the new forging and casting facilities continues as planned. With the majority of our strategic capital expenditure now behind us, our focus has decisively shifted towards sweating these assets to higher utilization, improving asset turn, and generating stronger operating leverage.

With cash flow set to strengthen, we remain committed to prudent capital allocation, and we will seek to reduce leverage while ensuring that adequate capital is deployed towards growth investment and maintenance capex. Let me now briefly share the financial highlights for the quarter.

Consolidated revenue for the quarter stood at ₹1,217 crore, which is flat quarter-on-quarter and it has registered a growth of 19.84% year-on-year. EBITDA, excluding other income, stood at ₹218.47 crore, that is up by 47% year-on-year and 5% quarter-on-quarter, while EBITDA margin improved to 17.96% from 17.11% in the previous quarter, reflecting better operating leverage and improved product mix.

Profit before tax for the quarter stood at ₹65.34 crore versus ₹23.9 crore year-on-year, and while profit after tax for the quarter stood at ₹46.88 crore versus ₹11.7 crore year-on-year, reflecting a growth of 172% and 297% respectively. With that, I would now like to hand over the proceedings to Mr.

Milesh Gandhi, Whole-time Director, who will take you through the order wins during the quarter. Over to you, Milesh.

Thank you, Lalit. It has been an exciting quarter in terms of order wins.

The company continued to witness healthy order inflows during the quarter, reflecting sustained customer confidence in our manufacturing capabilities, engineering expertise, and execution track record. During quarter one FY27, we have secured a business worth ₹278 crore with a program life of four years from automobile segment.

The company also won new orders worth ₹15 crore from metro segment of Indian Railways. Out of ₹278 crore, approximately 82% of these orders are in passenger vehicle segment, and 18% from two-wheeler segment.

We continue to witness encouraging traction across both our existing customer base as well as our new customer engagements, supported by our expanding manufacturing footprint and broader product portfolio. Our diversification strategy continues to make steady progress.

While commercial vehicle remains our core business, we are seeing increasing opportunities across passenger vehicles, electrical vehicles, energy, mining, off-highway, and railway segments. The share of our non-automotive business in our order book has continued to improve, reflecting our strategic focus on building a more balanced business portfolio.

Demand continues to be supported by healthy investment activities across infrastructure, industrial manufacturing, and commercial vehicles, while customer discussions across North America and Europe have become increasingly constructive compared to a year ago. We remain confident of sustaining healthy order momentum and building a strong foundation for long-term growth.

Would like to mention we are looking to new ventures within the boundaries of forgings and casting business in non-ferrous products, manufacturing products from aluminum, titanium, Inconel, and nimonic grades for aerospace, robotics, and semiconductors. We are seeking to leverage our advanced manufacturing capabilities with our participation as a strong engineering company in high-technological sectors which have been traditionally dominated by global players.

We are confident to create a strong impression. That's from my side.

Over to you, Lalit. Thank you.

Thank you, Milesh. Now Dinesh, you can open the house for Q&A.

Hi, sir. Thank you for the opportunity, and congratulations on the results.

Sir, my first question is on the wheel JV. Just to understand the TAM, other than the 80,000 wheel offtake that we have with the Indian Railways, how do we plan on utilizing the remaining capacity?

Just an addition to that, the 80,000 wheels that we are supplying, the wagons for that will be made by Titagarh, or will be made by the Indian Railway production houses themselves?

In terms of the wheel sets, we have an 80,000 confirmed order from the railways, and railways are going to use these wheels for manufacturing of passenger trains, locomotives, and Vande Bharat. These are the three contracted for this 80,000, wagon does not come into this.

Additionally to that, our JV partners have an obligation of close to around 20 25,000 wheels, which takes us the utilization to close to 1,10,000, and for the balance wheels, I think this 1,10,000 wheels manufacturing will take us till end of FY28, and beyond that, we are already working with our export customers and other entities beyond Europe and North America where we see a lot of traction in terms of wheel requirements. We would not like to name the customers right now.

Very soon, I think we will be able to tell our investors in terms of broader wins from the export market in the wheels plant. Okay.

Sir, just a follow-up to that, 25,000 from you're saying with the JV partner, considering the amount of wagon capacity they have, ideally they require more wheels, right? What's stopping us from supplying more to them?

Basically, they can only buy wheels for the private sector wagons which they manufacture. For Indian Railway, supplies are FOC basis, which Indian Railway supplies to them in casting.

The cast wheels which are manufactured by Indian Railways by themselves in Bangalore are basically used for manufacturing wagons, and are supplied free of cost to the wagon builders for use into manufacturing wagons.

Sir, this segment, sir, what is the annual demand when it comes to India as a market?

I will not be able to comment on that. Basically, how much is wagon wheel demand or casting wheel demand, I am not aware.

Got it, sir. Sir, just one last question, sir, on our other businesses of forgings and castings.

Sir, going forward, we expect utilizations to improve throughout the next three quarters, since you'd guided for higher utilizations by this year-end?

Yes, I think gradually you will see every quarter, Q-on-Q, there will be considerable utilization. I think the first quarter, we have done extremely well in terms of our overall utilization and top-line growth.

I think similarly, you will see every quarter this is going to get reflected.

Got it. Thank you so much, sir.

Thank you.

All the best.

Just wanted to get the timeline on the rail wheel project because we scheduled to commence in first week of May, the trial, and also on the Mexico acquisition that we've done because in the last call, we had discussed that this will also start somewhere in May. How's that panning out?

First, in terms of RKTR, wheel plant, already trial production has started, and I think we are expecting to submit samples in the month of August, first 300 pieces numbers of wheels to Indian Railways for that testing and trials. Post the trials, we will be able to comment on bulk production.

With our working right now, we expect bulk production to start, hoping to full-fledged supply to railways for the contractual demand by September or October latest on month-on-month basis. In terms of our Mexico, Mexico project productions have started, and I think from third quarter, you will see some significant revenues from Mexico.

Already this quarter, I think close to around ₹6 crore revenues have come from Mexico in terms of our top line, but significant revenue is going to start clocking in our books from third quarter of this year onwards.

Understood, sir. Thank you.

Thanks for the opportunity. Firstly, great set of execution.

We have been seeing Ramkrishna Forgings for last couple of years. We are going through some pain period.

Looks like now we are heading for a good growth. I have two questions.

Mainly, what are the target ROCEs for this year and next year, sir?

Lalit, can you take this one?

Yeah. See, ROCE is just coming back to our old level.

This year, what we are looking at somewhere between 12% to 15% ROCE, and next year in FY28, we will target my 20% ROCE. Great,

great. Secondly, sir, how much of the revenue are we expecting from exports market because we are coming from a destocking year?

We are looking at almost 35% revenue on a console balance sheet coming from exports for a full-year basis.

Little bit quantification, it will be highest revenues till now? This

will be highest ever revenue for RKFL in this financial year, for ever done in terms of exports.

Okay. That's great.

Lastly, I have question that two to three years back because of export shares were high, we were making 22% margin. Do you see that possibility happening in this year?

As an entrepreneur, we always see possibility of higher margins. Who does not want to earn higher margins?

Execution-wise, we are looking at higher exports. Environment is challenging in terms of the overall energy prices and other things, shipping costs, and all these things.

We would not like to guide the market in terms of profitability. What we are looking right now is continued growth in terms of balance sheet.

As we have already shown this in this quarter, we have improved our margin by almost 100 basis points quarter-on-quarter. This growth in terms of margin and improvement is going to be a continued work, and we are putting all our efforts in the right direction to ensure that we are back to our old profitables.

Great. Thanks.

Lastly, you mentioned that you are venturing into aerospace and semiconductor. Can you also throw some light, what are the

things? No, I think as Milesh has updated that we are already working very aggressive.

We have already started working on aluminum forgings, and we have started bulk supplies in aluminum forgings. Non-ferrous now becomes the next lever of growth for RKFL, and it is a journey which we have just started, I think it is at least 12 to 18 months before we have a significant revenue or product lines from this section.

We are very aggressively working on non-ferrous products of aluminum, stainless steel, Inconel, and other things for aerospace, semiconductors, and robotics. We would not come up with customer names and other things, but we have already started quoting for a lot of RFQs from this sector, and accordingly, we have already planned our equipment and other things in these directions.

All the best. Thank you, sir.

Sir, my question was a little bit in terms of margin only. More than one quarter out for the rest of the three to four quarters, could you just guide a broad range for where the margins will be for the next full year?

No,

I think I would not like to give a range in terms of the margin for the full year, but I can only assure you that you will see continued improvement in terms of margin every quarter now. Like Lalit is in opening statement has already said that we are concentrating on sweating the assets right now, and this increase in utilization is going to lead and plus with export product mix moving up, I think you will see much better margins.

Our intention and our aspiration is to go back to the old margins which we were already achieving. I think sooner or later, we will touch that margin, but I cannot give how many quarters it may take to get to that margin.

No problem, sir. Got it.

Sir, in terms of the margin, what would be the factors which could aid the margins more than what you are targeting, or what could be the risk factor? Like what goes wrong, the margins can come down and vice versa?

Only risk which we are looking at is the geopolitical issues which is leading to shipping delays. Because of this shipping delays, there is a lot of working capital pressure which may increase, as well as the prices of the energy.

Energy is one of the biggest ingredients in overall our forging setup. May it for steelmaking, or whether it is for forging as such.

Energy happens to be one of the biggest cost lever. With the war, if it escalates and energy prices goes beyond control, I think that is one of the major risk which we are running in terms of our profitability.

Thank you very much, sir. Thank you, sir.

That's it from my end.

Thank you for the opportunity. Sir, I have broader question on the overall belt on this last 3-4 months West Asia crisis.

What is our experience in terms of the inquiry levels or consumer behavior on that side, particularly from the non-US geographies in terms of the opportunities as well as challenges for auto as well as non-auto segment, and the inquiry level has gone up significantly or anything?

Mitul, I think we are quite optimistic for next seven quarters, next two years, FY27 and FY28. We are confident with the current order book which we have, I think Milesh statement states very clearly, we are flooded and we are very, very in exciting times right now in terms of overall demand, in terms of existing products as well as new products, and in terms of new RFQ inflows which will cater to new order book going forward.

We are in pretty exciting times. War is a cost, and I think that in terms of demand, we don't see any deflection in demand.

I think we are seeing incremental demand coming in. That's actually the biggest challenge which we are facing right now going forward.

Great, sir. Second question on this, as we all know that commodity cost as well as freight cost has gone up significantly in this quarter, would you like to highlight anything in terms of the quantum or basis point where we are not able to pass on the full commodity impact to the customer?

What is the industry-wide scenario on this that Q1?

No, I think, Mitul, commodity is a pass-on for us with a one-quarter lag. Commodity, whatever increases happen in steel, steel is the commodity for us which is a major basic raw material, that is a pass-on for us.

Separate to that, gas and other things, I think that is a cost we will need to work with, because this is so much fluctuating, I think customers are not prepared to go ahead and pay that. Shipping cost, it depends.

Right now, we are seeing some abnormal cost increases, but gradually we are hoping also that to stabilize, because when we started this quarter, it had already come down, but this is roller coaster. I think we are working with customer how to absorb this cost, but we do not have a definite answer for this.

Sir, exactly same question. I was asking about commodity, that because of the lag effect, this quarter you were not able to pass on completely, right?

Would never this benefit will get reflected in coming quarter?

Yes, that is steel price, only steel price. Steel commodity, yes, correct.

Lastly, sir, on this casting production in terms of metric ton has gone up significantly between the quarter. Can you highlight more details on this, as well as any update on the cold forgings side?

Casting production, Mitul, had started last quarter. I think you must have seen March stock exchange releases we have sent, the casting plant was capitalized last quarter.

That production has started coming, and still the plant is work-in-progress in terms of overall capacity ramp-up. You will see gradual increase in production from casting capacity over the next three quarters.

In terms of cold forging and other things, I think we are working diligently in terms of improving the capacity utilization. I think by almost third quarter, we will be more than 70% capacity utilization in cold forging.

Thanks a lot, sir, and all the best.

Hello, am I audible?

Yes, you're audible.

Good evening and congratulations on a good set of numbers. My first question was related to margins.

Our gross margins have increased by 585 basis points Q-o-Q, but our EBITDA margins have grew by 85 basis points Q-o-Q. If my understanding is correct, even with our volumes not growing significantly Q-o-Q, the entire improvement in EBITDA margins is purely because of increase in our realizations, and not any operational leverage.

How do we think that this EBITDA margin improvement is going to play forward? We cannot be having price revisions every quarter, right?

No, I think it is wrong to say that this is only because of price revision. I think because of the better product mix and other things, that is the reason there is an increase.

I think gross margins it has increased, while the EBITDA has not increased mostly because of the energy cost, shipping cost, all this cost we have not been able to pass on. [Speaking in Hindi] That is one of the major reasons.

Otherwise, whenever it stabilizes, you will see significant improvement in EBITDA margins also. [Speaking in Hindi] Hello?

Hello? Hello.

Hello. Hello.

Can the moderator please check where is the noise coming from?

Okay. We can get in the next call, I think.

Thanks for the opportunity, and congrats for a strong set of numbers in a tough time. Sir, my first question on the export market.

We have seen very strong numbers Y-o-Y and Q-on-Q. Just wanted to understand the outlook ahead, basically what is the guidance of export growth for the FY27, and how is the improvement in the Class 8 trucks orders in the US, and improvement in European business?

I think we are looking at one of the best years in terms of the overall export revenue in terms of RKFL is concerned, both from geographies of North America and Europe. We would not be able to comment on Class 8 truck how it is behaving and what exactly it is resulting to, but in terms of RKFL order book and traditionally what we are seeing in terms of our existing customers and the new customers, we look at a extremely healthy growth, and maybe it is not wrong to comment that we should have one of the best years in terms of our overall exports in this financial year.

As the base of the export is low, can we expect the 20% to 25% growth in export in this year?

Yes, we are looking at almost 20% plus growth in terms of our exports.

Got it, sir. Sir, in the domestic market, realization has seen a very sharp jump in quarter-on-quarter.

Is it because of the change in the mix in the non-auto segment, or higher revenue from the casting business? No,

basically it is a mix of change of revenue from higher mix. Because of the demand, we have been able to improve our utilization, and we have been able to choose much better margin products and much better realization product.

That is one of the reasons that we have been able to have a higher realization in the domestic market.

In the domestic market, what is your guidance for the volume growth in this year, sir?

I think domestic market continues to be robust, and the demand looks to be extremely good. With the rainy season almost, I think, in next two months going to be over, next half looks to be extremely exciting in terms of domestic demand.

Great, sir. Sir, if I see the subsidiaries' numbers, we have seen a sharp improvement in the EBITDA margin.

Now it has moved to that 21% versus 16% in the last quarter. Depreciation cost has increased.

Just wanted to understand what is the region of the sharp margin expansion in the subsidiaries companies, and what is the region of the increase in depreciation cost?

Lalit, can you take this question?

Sure, sir. See, margins are I will say little bit better or I will say marginally better in the subsidiaries in this quarter than the previous quarter.

There is no such sharp contraction. Because due to the higher elimination, you are seeing this 21% margin.

Margins are 50 to 100 basis points higher than the previous quarter in the subsidiaries. Certainly the depreciation is increased due to the capitalization in the Q4 in the subsidiary also.

Whatever the projects we were doing, that has completed. That's why the depreciation has gone up, and it will continue at this level in the upcoming period.

Got it, sir. My last question on the sir aerospace defense segment.

Just wanted to understand how much the current contribution from this business, and what kind of the numbers you are looking from this business? You are also establishing a capacity for the titanium and other alloys.

If you can throw some light over there because that is a high-margin business, and the ASP would be at a higher side. If you can throw some light over there.

Hello. Yes, I can hear you.

Hello.

I think we have zero exposure right now to any aerospace activity right now. We are already in terms of quoting in RFQs and other things.

We are looking at in next two years to build up our order book in terms of aerospace and semiconductors and robotics and other things, and we are already putting and establishing capacities to manufacture Inconel and titanium products.

Got it, sir. Thank you, sir.

That's all.

It is a work-in-progress.

Got it. Thank you, sir.

Thank you for the opportunity, sir, and congratulations on a really good set of numbers. Sir, I'm sorry I joined the call a bit late, but when we are getting into products like titanium and Inconel, do you think there will be a good amount of period that will go into approval of these products and capability building?

If that is the case, then what should be the timeline we should have in our mind that when these products will be operationalized and starts contributing to top line?

Any meaningful contribution, I think it's at least two years from now. I think I replied to the earlier question also, we have zero order book.

We have started quoting in RFQs, and we have started building parallelly capabilities as in work-in-progress in terms of our manufacturing of Inconel and other steel. Aluminum we already have in place.

We have already gone into bulk production in aluminum forgings. In terms of stainless steel and other things, that is work-in-progress.

I think significant portion of stainless steel forging will start happening because of we have already got some order books from fourth quarter of this financial year. In terms of Inconel and other things, I think it is still work-in-progress and it will take at least 8 to 10 quarters from now.

Okay. If we have to build capacities on these fronts for Inconel and titanium, what is the capex that we have in our mind that can go into building these capacities?

No, right now, we already have capability and capacity. Only heating arrangements are being made for heating these steels.

Other than that, I don't think there is going to be major capex. In terms of the current RFQs we are handling, there will be no major capex.

It may be in the tune of ₹10 to ₹15 crore or at the most ₹20 crore to get away with the capex immediately. When we go into significant portion of the business, then we may look at significant ramping up capacity, then we may need to do additional capex.

Okay. One last question, sir, on orders.

We have got ₹278 crore of orders from the auto segment. Is this all domestic that we have got, or is it from what geography if we have got this from?

Milesh?

Out of ₹278 crore, this entire business is from domestic. Because the two-wheeler business, around 18% that I stated, is also a domestic brand, and the 82% order for the passenger vehicle segment is also for the OEM.

Okay. Correct me if I'm wrong, is this two-wheeler business the crankshaft business that we are doing from the machining facility that we have in our Gurugram business?

Yes.

Okay. Thank you.

Yes. Thank you for the opportunity, sir.

Sir, my first question is, would it be possible to share the gross and the net debt numbers? Viral,

we have shared this gross and net debt number last time and we have been able to improve upon the net debt by another ₹100 crore in this quarter. Last quarter, if you remember, ₹1,990 was the net debt, and ₹18.9 it is ₹1,890 or ₹1,900 crore of net debt this quarter.

This quarter is ₹1,900 crore. How are you looking at this number, sir, by the end of the year?

Lalit, you can answer it.

We have already guided in our last call that we will reduce at least ₹500 crore of leverage in this financial year, and we are on track for that.

By the end of the year, we should be down to ₹1,500 crore of net debt?

Yeah.

Sir, secondly, just related, sir, what would be the capex outflow this year as well as the investment towards rail JV?

Investment towards rail JV, the first phase is almost complete. Another ₹20 to ₹30 crore from our side will go, and total guidance for the capex in this year is somewhere around ₹350 crore.

₹350 crore. Perfect.

Thank you. This is helpful.

Congratulations on great set of numbers, sir. I think the rate at which we are growing, and I think you told in the last quarter also, we'll be hitting 80% utilization by FY27-end.

My question is, is that the peak utilization, and if that is so, then after this, sir, what is our next capex plan for further growth since we'll reach peak in 1-1.5 years? No,

I think we are looking at a lot of activities right now. We have already explained in the opening statement, Milesh has already categorically explained that we are looking at already working with customers in aerospace and other verticals, and our entire plan is to ramp up our fresh manufacturing or new augmentation of any capacities which we think of is going to be into these verticals.

We will only announce any major capex by end of FY28 when we have a clear visibility in terms of order book and approvals in place in this verticals. I think that till then, we can do away with small capex, and I think we are good to go for next two years of significant growth path with the current capex we have already done.

Got it, sir. Then the debt reduction should continue in FY28 also, and should be, FY27 you said ₹1,500, maybe ₹1,000 crore of net debt should be expected by FY28?

I think debt reduction, leverage reduction, I think in the opening statement also, Lalit has very clearly said our company's endeavor is to continue to have the reduction in leverage in terms of our overall debt exposure while company continues to grow. I think we are not looking at a zero-debt company, but we would like to keep debt into a significant check in terms of our overall leverage, and continue to grow the company.

Great, sir. Last question, sir, our gross margins were great, but as you said, because of energy and transportation fuel cost, little bit of margin hit happened.

How things are progressing in Q2 so far? Do you see any improvement there in the market conditions?

No, I think we have not seen any improvement in terms of market conditions. You are well aware of the current geopolitical issues, and unless this geopolitical issue has some conclusion, I don't think we are going to see moderate energy prices or shipping cost.

Sir. Thanks a lot, sir, and best wishes.

Most of my questions have been answered. Only one question is with the net block that we have currently, what kind of sales can we generate if we are working at 100% capacity?

Lalit, can you answer this question?

I could not get the question. Can you repeat the question?

I said with the net block that we have currently, close to ₹3,700 crore, what is the sales at 100% capacity that we can generate in this kind of net block?

The kind of net block right now we are having and a little bit of net block is under capitalization of casting, certainly looking at asset turn of 2.5 on this. If you look at asset turn of 2.5, it will be somewhere around ₹9,000 crore of sales on this if you have a 100% capacity utilization.

I think it is very difficult to have 100% capacity utilization. It is safe to say that we will have almost 80% 75% to 80% of capacity utilization before needing our next capex.

Got it, sir. That's all from my side, and good luck for future.

Sir, my first question is, any plans to avoid the one-quarter lag that you see in the steel prices? Basically, if you plan to hedge the prices quickly, that would be passed on to and if you avoid passing on to next quarters, that would be helpful in increasing margin for the continuous quarters basis.

No, steel price cannot be hedged. Steel price, I think there is no hedging system for steel price.

Alloy steel price is bought on spot quarter-on-quarter. Every quarter, there is a price which the steelmakers declare, and based on that, that is bought.

Basically, there is no hedging policy in terms of steel price.

Got it. Sir, ring rolling capacity is already at 125% 27% utilization.

Any plans to add that?

No, we have no plans to add any capacity. We are looking at almost peak utilization continuing for this at least for next two to three years because of the current order book.

Got it. Sir, just wanted to understand if you plan to add any further capacities, what are the factors based on which you decide?

Because you are adding a press line at 60% current utilization, and the press line is going to increase. Based on the current utilization, the current utilization would be reduced.

Overall, just wanted to understand what are the factors based on which you decide?

Basically, we decide based on the order book and customer confirmation which we have. In terms of utilization, I think the press line which we evolved to put does not happen overnight or over one quarter.

It takes at least four to five quarters from now for the capacity to be in place, by when we will be at least around 80% utilization in terms of the press capacity.

Naresh, namaskar. Bharat bol raha hoon.

One of the most important things that I felt in this quarter, or rather this year, has been improvement in the working capital. Clearly, Lalit, jo aap bata rahe the, that seems to be now finally falling in place.

Operational cash flow after working capital hit about ₹840 crore last year and probably is highest in the history of the company. Just wanted to understand how do you visualize things ahead?

Bharat, this see, certainly the focus is on further improving the working capital days because this quarter this quarter, there was a little bit elevation due to this West Asia crisis, shipping costs, or transit time. With the time, it will further I will improve and certainly this journey to improve the working capital days in overall working capital, it will continue.

Our focus will be to further optimize the same. I will not give any target to that, but certainly we will work keep on working on that.

Right. Improvement to Lalit is a forever exercise.

Improvement, learning is a forever exercise. If there is a tangibility to that, then there is a purpose, and then there is a greater way to measure it, and greater way to achieve it, actually.

Some kind of a target in terms of how much improvement in working capital we are seeking to achieve would give a little bit more clarity.

Bharat, coming to specifics, certainly we will take baby steps. We have internal targets certainly.

As we have set the target to improve debtor days by at least 5 to 10 days, inventory days by another 5 days, and increase the creditors days by another 10 days. Altogether, it will be certainly 15 to 20 days of improvement.

If this has to happen, this cannot happen in one or two quarter. It may take one year and everything remaining static, or it may take a little bit more.

We have to keep on working towards that. Toh aap matlab yeh saal mein 12-15 din, agle saal bhi 12-15 din, yeh aap keh rahe hain?

Aap 10-10 din leke chalna chahiye, Bharat-bhai. Agar us tarah se lena hai toh, you should take 10 days for this year and 10 days next year.

Theek. Ji.

Naresh-ji,

earlier we were very confident and hoping for turnover of close to ₹8,000 crore by the fiscal '28. Now in between, a lot of these tariff upheaval occurred, there were internal upheavals, and finally I think hopefully all those things are behind us.

Now when do you think we should be hitting that target of ₹8,000 crore? No,

I think, Bharat, with all what has happened in past, I think we are one year delayed. I think with last year's performance and now continuing improving on that performance, I think we have got delayed by one year, and I think we are on track right now with FY29 target as ₹8,000 crore.

Which means roughly 25% compounded growth from the last year's turnout. Kyunki last year ₹4,200

crore hua toh ₹8,000 crore matlab 24-25% ki growth. Yes, around 22% to 25% CAGR we will have for next three years.

Naresh-ji, yeh

this time clearly when we get beaten once, we become twice shy. I suppose there is a large opportunity.

We have strength and capability, we have product portfolio, we have client relationships, and there is an improving market. Would you say that probably the best phase of Ramkrishna Forgings hopefully should begin now, given also the fact that all the internal upheavals also would have taken some energy for us to get over?

Therefore, if all of this is behind, mentally we are more resilient, and overall opportunity has become better outside, and we are better prepared, would you say probably this is the most interesting period for Ramkrishna?

Bharat, I think I can confidently tell you, best period for RKFL has just started. I think in coming quarters, coming year, you will see much more traction in terms of growth, in terms of improvement in balance sheet.

I would not like to comment on profitability and other things, but I can tell you one thing very confidently, that every quarter, you will find significant improvement in the overall balance sheet of the company and overall parameters which you measure. Each and every parameters of working capital or utilization or inventory days, everything you will find significant improvement in coming days and quarters.

I think for next three, four years, we are extremely confident, the visibility what we have, that RKFL will be one of the best performers in terms of overall demand-side absorption and creating a new brand for itself in this coming years.

Sure. If I have to put a little bit of

No, I just need to complete this question. If I have to express any bit of skepticism about it, given the fact that we've gone through challenges, what are the factors, Naresh, now you believe gives a far greater confidence about our destiny than I'd say what was the case one year back, one and a half years back?

Right now, Bharat, working in terms of passenger vehicle, oil and gas, and non-automotive sector like earth-moving equipments are giving us extreme confidence. We are looking at tangible growth, which really shows company in the non-auto sector growth or non-CV growth, and kind of order book which we have been able to make over last couple of quarters in terms of our passenger vehicle, I think next two years are going to be exceptionally exciting in terms of our PV and growth, and this is going to be the next lever where there is going to be transformation on overall RKFL.

Please go ahead. Congratulations, sir, on the great set of numbers.

I just have one confusion, sir. Everything railway-related opportunity is catered through the JV, right?

I just No, no,

no. I think you are wrong.

JV is only for manufacturing of wheels. It is doing nothing else except manufacturing of wheels.

Rest railway, everything is isolated standalone RKFL. RKFL has its own significant order books for railways which we are working and continuously growing.

Wheels JV is only going to be part and parcel of manufacturing wheels, nothing else.

Sir. That's it from my side.

Thank you so much.

Hello. Am I audible?

Yes, you are audible.

Yes, actually I would like more insight into the export growth that you are anticipating. Could you just give us a color of what segment or what kind of customer base we are getting that, because you are not commenting on the Class 8 truck growth?

Could you just give us a color of how the growth is coming from the export markets?

I think I would not like to be able to comment in terms of the customer name or brand of the customer, but we can say in terms of Europe, you have already seen. I think you have a lot of background noise.

Hello?

Hello.

Can you hear us?

Yes, sir.

Basically, you can very well see in our presentation also, in Europe and North America, both the places we are growing. New order wins from the existing customers as well as new order wins from the new customers, both are giving a very big jump into the next year or coming quarters in terms of our overall intake in terms of the order book.

We are very confident in terms of our export demand and deliverables.

Sir. Sir, in the domestic product mix that you said that it has improved, could you give us a color about that as well, like in what segment are we getting a higher margin that our product mix has been better?

No,

I think in terms of margins, I would not like to comment on individual sectors or individual places. I think overall company margins have been shown.

We do not earmark any particular sector in terms of margins.

Sir.

am I audible?

Yes, you're audible.

Sir, one quick question regarding the order book. I think we have got around two I think ₹228 crore from PV.

Within this, what percentage would be electric vehicle, because last time, I think almost the entire exports PV was towards the electric vehicle if I recall. Any color on this, sir?

Any EV portion in this passenger vehicle?

Milesh, can you reply?

This order which we announced, this is completely from the EV, but that is from the domestic side EV, this brand is within the Indian market. Actually our requirement is for the domestic manufacturers.

Just to be clear, sir, now that you have clarified this, our entire passenger vehicle order book, be it domestic or exports, everything is geared towards electric vehicle, is that a fair statement?

No, that is not a fair statement. We have both the sides.

We are also there serving customers who are into the ICE side, and we are also serving customers who are in the EV.

What would be the breakup, sir, ICE versus EV within the order book?

In our passenger vehicle segment, I would say around 50-50%, we are serving both ways.

Within exports, almost 100% is EV, is that a fair statement?

Currently, whatever you would have been seeing sales has been more to the EV, but our bulk supplies to the ICE side also starts, and I think we have a fair requisition within the 50-50 range, whatever I have stated, you will be finding similar numbers coming in the future.

Yes, thanks for the opportunity. Just one question, sir.

If you could comment on the realization in the casting division, which has come off quarter-on-quarter. What is the reasoning behind that, and how do you see this going forward?

That's it from my side.

No, I think because of the new capacity which has come up, that's the reason just to have some utilization improvement, we have done some components which did not give us the exact right realization. I think with coming quarter, you will be able to see the realization back or more than what we had reported previously.

Thank you.

Sir, just wanted to understand one last thing that this 54% of gross margin, can we sustain it for further quarters, or are we seeing it going back to our old levels of 50-odd percent?

Can you repeat your questions? I think voice is breaking actually.

Am I audible clearly now?

Yes.

I was asking if can we sustain this 54% of gross margin we booked in this quarter for going forward, or are we looking to going back to the 50-odd percent we were doing before?

No, I think this margin is sustainable margin, and you will see improvement on it going forward.

Any further gas problem sorted any

I think already Energy prices is at peak when we have this balance sheet in place. Obviously, I think, God forbid, we don't see where the energy prices crossing those levels again.

Got it. Any improvement in energy prices, we would be seeing increase in margins, operating leverage would be kicking in.

Got it.

Sure, thanks.

Lalit, while clearly in the first quarter, margins have improved by about a little less than 1% compared to last quarter, but I would have thought that rupee depreciation should have helped us plus gross margin having improved significantly. Really the improvement in operating margin has come from internal working and operating leverage and productivity gains, or it is simply due to mathematics of the rupee depreciation and stuff like that and gross margin improvement?

Bharat, rupee depreciation is entirely passed on. I think currency gain is for us every quarter we have to pass on.

All our contracts are currency pass on basically, we don't get any significant benefit on the currency either depreciation or appreciation, we are not affected. Both the sides, we don't run a risk of currency.

Basically that is true for all contracts for RKFL. I don't know for other companies, for RKFL, currency is pass-on every quarter.

That was not I was aware of. Thank you.

Just to add one more thing, Bharat, the currency depreciation for the quarter was only in the range of 1% to 1.5% only.

Sorry, say that again?

Currency depreciation in the quarter was only

1% to 1.5%. Haan, but hamara margin bhi toh 1% se hi bada hai na?

Yes, for the quarter. Haan, but

it's only on a part of the business, exports being just the part. No, I got it.

Thank you.

Thank you. We would like to thank all of you for taking your time and joining our earnings call.

We hope we have answered all your queries to your satisfaction. Would like to further inform that you can get in touch with us or CDR if you have further information which is required from us.

We look forward to interacting with you the next quarter. Thank you very much for joining the call.

Thanks very much.