NIFTY 50

Better capacity utilisation to lift bottomline, says Ramkrishna Forgings MD

Updated : February 14, 2020 03:20 PM IST

Ramkrishna Forgings posted a weak set of Q3 earnings. The total tonnage is down almost 50 percent and the margins have also contracted.

According to its managing director Naresh Jalan, the drop in tonnage is owing to the transition from BS-IV to BS-VI. “OEMs are still not getting prepared for making BS-VI and coronavirus also has made a dent in the launch of BS-VI. I think the full production of BS-VI will be seen from April onwards,” he observed.

At present, the company's 15 percent of revenues come from exports. "In Q2 of FY21, we will see exports going up and we expect to reach FY19 tonnage in terms of our exports next year,” Jalan stated.

The company is doing well on margins. "With the capacity utilisation improving, we will see good traction on the bottom line.  The Scrappage Policy will come anytime and once it is introduced, at least for the next 5 years, the auto OEMs and ancillaries are going to see good times,” Jalan added.
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