Any current/future new fundraising through debt or equity?

The company has both debt and equity fundraising options under consideration and is keeping both options open. Timing of debt and equity raises will be different, so the company is evaluating them in parallel. The fundraising is aligned with the capital expenditure (CAPEX) strategy focused on growth, particularly for upgrading assets and expanding capacity. The company plans to increase fixed assets to support growth, reduce working capital debt, and increase long-term debt for a healthier funding mix. No specific timeline or amount has been disclosed for the fundraising activities.

Any current/future capex/capital investment/strategic investment?

FY26 CapEx budget is ₹25 crores. Approximately 60% of CapEx allocated to future growth areas: driveline and axle segments. Remaining 40% focused on the engine product group, which is experiencing significant growth. About ₹7.6 crores of the CapEx budget is dedicated to reconditioning forging presses, primarily to increase production output for new driveline and engine business. Emphasis on upgrading asset base to improve productivity, quality, and reduce rejections. Goal to productionize ₹30 crores of new business in FY26. Focused on quick turnaround for CapEx projects to start generating retu

Future growth expectations in sales/revenue/volumes?

The company aims to productionize new business worth around ₹30 crores in FY26, a significant jump from previous years. Installed capacity can theoretically generate revenues up to ₹500 crores, with current revenues at 3.5 times net fixed assets. CAPEX plans aim to increase fixed assets, enabling this growth. Focus on new growth areas like driveline and axle, with ₹45 crores and ₹10 crores new business order book respectively, showing strong potential beyond the core engine segment. Business mix optimization and pruning of non-core, low-margin businesses aim to improve scalability and lo

Future growth expectations in earnings/operating earnings/profits/EPS?

EBITDA margin target: Medium-term goal to achieve at least 15%, with a longer-term milestone of around 20%. Current priority is stabilizing at ~15.7%, with 20% within sight but no specific timeframe given. PAT margin improvement driven by EBITDA margin expansion, price improvements, optimized depreciation, and better interest cost management. New business productionizing target: Rs. 30 crores in FY26, expected to provide a good jump versus previous years. Revenue for FY26 expected to be around the same or slightly higher compared to last year; EBITDA margin expected to improve year-on-ye

Current/ Expected Orderbook/ Pending Orders?

The new business order book value is around ₹162 crores, comprising: - ₹107 crores from connecting rods (core engine business) - ₹45 crores from driveline segment - ₹10 crores from axle segment New growth areas like driveline and axle represent multiples of existing business in those segments. New business includes ramp-up of xEV driveline programs and new MNC customer orders in the axle segment. The company is focusing on increasing vehicle and customer share of wallet by offering engine, driveline, and axle components. Older low-margin and unrelated businesses are being pruned to focus

IN US

Kalyani ForgeQ4 FY26Industrial Products

Kalyani Forge Q4 FY26 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹606P/E: 24.0Market Cap: ₹224 CrSector: Industrial Products

Management growth scorecard

Revenue

Category 4

Margin

Category 2

Fundraise

Yes

Order

Yes

Capex

Yes

3 of 5 growth signals are positive.

Full analysis

Revenue guidance

Category 4

→The company aims to productionize new business worth around ₹30 crores in FY26, a significant jump from previous years.
→Installed capacity can theoretically generate revenues up to ₹500 crores, with current revenues at 3.5 times net fixed assets. CAPEX plans aim to increase fixed assets, enabling this growth.
→Focus on new growth areas like driveline and axle, with ₹45 crores and ₹10 crores new business order book respectively, showing strong potential beyond the core engine segment.
→Business mix optimization and pruning of non-core, low-margin businesses aim to improve scalability and long-term margin stability, enabling faster growth.
→Seasonality affects demand across segments but diversification across passenger cars, trucks, construction, and agriculture provides hedging.
→Strategic investments in forging and machining capacity upgrades target increased production output and value addition.
→Strong emphasis on customer quality upgrade and new business order inflow to sustain profitable volume growth.

Margin guidance

Category 2

→EBITDA margin target: Medium-term goal to achieve at least 15%, with a longer-term milestone of around 20%. Current priority is stabilizing at ~15.7%, with 20% within sight but no specific timeframe given.
→PAT margin improvement driven by EBITDA margin expansion, price improvements, optimized depreciation, and better interest cost management.
→New business productionizing target: Rs. 30 crores in FY26, expected to provide a good jump versus previous years.
→Revenue for FY26 expected to be around the same or slightly higher compared to last year; EBITDA margin expected to improve year-on-year.
→Capacity expansion underway to support revenue growth, aiming for installed capacity to produce up to Rs. 500 crores in revenue eventually.
→Seasonality and diverse product segments provide hedging benefits; long-term trends favor automotive premiumization and market growth.
→Strong operational reset and continuous improvement underway to sustain margin improvements and growth.

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Fundraise plans

Yes

→The company has both debt and equity fundraising options under consideration and is keeping both options open.
→Timing of debt and equity raises will be different, so the company is evaluating them in parallel.
→The fundraising is aligned with the capital expenditure (CAPEX) strategy focused on growth, particularly for upgrading assets and expanding capacity.
→The company plans to increase fixed assets to support growth, reduce working capital debt, and increase long-term debt for a healthier funding mix.
→No specific timeline or amount has been disclosed for the fundraising activities.

Order book

Yes

→The new business order book value is around ₹162 crores, comprising:
→ - ₹107 crores from connecting rods (core engine business)
→ - ₹45 crores from driveline segment
→ - ₹10 crores from axle segment
→New growth areas like driveline and axle represent multiples of existing business in those segments.
→New business includes ramp-up of xEV driveline programs and new MNC customer orders in the axle segment.
→The company is focusing on increasing vehicle and customer share of wallet by offering engine, driveline, and axle components.
→Older low-margin and unrelated businesses are being pruned to focus on strategic growth areas.
→Productionizing around ₹30 crores worth of new projects in the current financial year, with ₹20 crore roughly done in the first nine months.

Capex plans

Yes

→FY26 CapEx budget is ₹25 crores.
→Approximately 60% of CapEx allocated to future growth areas: driveline and axle segments.
→Remaining 40% focused on the engine product group, which is experiencing significant growth.
→About ₹7.6 crores of the CapEx budget is dedicated to reconditioning forging presses, primarily to increase production output for new driveline and engine business.
→Emphasis on upgrading asset base to improve productivity, quality, and reduce rejections.
→Goal to productionize ₹30 crores of new business in FY26.
→Focused on quick turnaround for CapEx projects to start generating returns rapidly.
→Strategic investments aim to increase installed capacity towards ₹500 crores revenue potential by expanding and capitalizing fixed assets.
→Also, maintaining flexibility in funding options with both debt and equity planned for CapEx.

How does Kalyani Forge rank vs peers in Industrial Products?

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1Kalyani Forge

Rev 4Mar 2

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