Ladies and gentlemen, good day and welcome to the RK Forgings Limited Q4 FY 2026 earnings conference call hosted by 360 ONE Capital Market Private Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. I now hand the conference over to Mr. Annamalai Jayaraj from 360 ONE Capital Market Private Limited. Thank you, and over to you, sir.
Thanks. Welcome all the participants on behalf of 360 ONE Capital Market for Ramkrishna Forgings Q4 FY 2026 and FY 2026 earnings 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 Mundra, Vice President, Finance and Company Secretary. I'll now hand over the call to the management for opening remarks to be followed by the question- and- answer. Over to you, sir.
Thank you. Thank you, Jayaraj. Good evening, everyone, and thank you for joining us on this call to discuss the Q4 FY 2026 earnings. I trust all of you have had a chance to review the earnings document that we have shared with you. In Q4 FY 2026, the global macroeconomic environment turned incrementally more challenging, although conditions continue to vary significantly across regions and sectors. While the quarter commenced on a relatively stable footing, carrying forward momentum from the prior period, the outbreak of conflict in Middle East adversely impacted operating conditions towards the later part of the quarter.
As a result, the energy price volatility, persistent inflationary pressures, and renewed supply chain disruption created uncertainty for a certain business environment. In contrast, the domestic macroeconomic environment remains relatively favorable. India continue to stand out as one of the fastest-growing major economies supported by resilient consumption, sustained government CapEx, infrastructure activity, and improving manufacturing momentum. Against this backdrop, we are pleased to report an improved performance in the fourth quarter, enabling us to end FY 2026 on a strong note.
Volumes in domestic market have been strong. Following the GST rate recession in September, there has been sustained momentum in domestic auto industry in India. This resulted in sustained momentum in wholesale volumes with all segments such as M&HCV, tractors, PVs reporting double-digit growth in the fourth quarter.
As we had indicated, the Railway business has been a strong pillar of growth. We have taken steps to deepen our footprint and enhance capabilities in this segment in recent years. These are now paying dividends. The share of business from Railway has grown to 7.5% of revenue in this year against 4.6% a year ago.
Now let me share some financial highlights for the quarter. We reported consolidated revenues of INR 1,216.78 crore that is higher by 28% on year-on-year basis compared to INR 947.21 crore in Q4 FY 2025. On a quarter-quarter basis, revenue were higher by 11% compared to INR 1,098.52 crore in Q3 FY 2026. A strong performance in domestic market supported by resilient performance in international market helped us to deliver solid top-line growth on a year-on-year basis as well as on Q-on-Q basis.
EBITDA excluding other income is INR 208.19 crore in Q4, higher by 111% year-on-year compared to EBITDA of INR 98.5 crore in Q4 FY 2025. On quarter-on-quarter basis, EBITDA was higher by 27% compared to INR 163.37 crore in Q3 FY 2026. The margin improved to 17.1%, higher by almost 220 basis points quarter-on-quarter. Profit before tax is INR 64.33 crore in Q4 FY 2026 compared to INR 29.69 crore in Q3 FY 2026, reflecting 117% quarter-on-quarter growth.
Profit in the consolidated accounts has been impacted by around INR 10.4 crore due to elimination of profit of INR 5.9 crore from the subsidiaries and loss of INR 4.5 crore from the Mexico subsidiaries. Otherwise, the profit could have been much higher on the consolidated basis. On the full- year numbers, we reported consolidated revenue of INR 4,238 crore for the full year FY 2026. That is higher by 5% on year-on-year basis compared to INR 4,034 crore in FY 2025. EBITDA stood at INR 642.70 crore for FY 2026. That is higher by 15% year-on-year compared to INR 559.56 crore in FY 2025.
Profit before tax is INR 112.58 crore in FY 2026 compared to INR 148.79 crore excluding exceptional item in FY 2025. That is lower by 24% year-on-year. Additionally, our Rail Wheel joint venture remains on track with commercial production anticipated by Q1 FY 2027. With these growth levers firmly in place, we are confident that from the next quarter onwards, we will return to further improve operating territory and look to sustain the momentum throughout FY 2027. With that, I would like to hand over the proceeding to Mr. Milesh Gandhi, Whole-time Director. Thank you. Over to Milesh.
Thank you. During the Q4, the company secured new orders worth INR 594 crore with the program life of four years. 56% of these orders were from Automotive segment. Balance 44% were from the Non-Automotive segment, reflecting continued progress in company's diversification strategy. Out of the INR 594 crore, INR 334 crore came in the Auto sector. Of which INR 323 crore came from the CV sector. INR 11 crore came from the EV sector. In the Non-Auto sector, INR 258 crore came from the energy segment itself. INR 2 crore from the off-highway. That's from my side. Thank you.
Thank you, Milesh. It's over to you, Jayaraj.
Operator can go for Q&A.
Thank you. Thank you very much. We will now begin the question- and- answer session. Anyone who wishes to ask a question may press star and one on the touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.
Before, somebody joins on the question queue. Sir, how is the demand shaping in U.S. market, sir? Hello?
Hello.
I'm audible, sir?
Yes.
Okay. I was asking, how is Class 8 volumes picking up in the recent times?
I think, Class 8 trucks are very strong right now. I think since last three months we are seeing destocking happening in our warehouses in North America. I think we are looking at fresh revenues coming in from this quarter onwards from North America Class 8 trucks in significant manners.
We expect this to sustain for some time, sir, at least a year or two?
I think at least for two years.
Mm. Okay.
Calendar year, it is good to say that it's going to stay till third quarter of calendar year 2027.
Okay. Okay. We'll go to the questions.
Thank you. We have first question from Balas ubramanian from Arihant Capital. Please go ahead.
Good evening, sir. Thank you so much for the opportunity. Sir, on that wheel set plant mentioned, it will be commencing from Q1 FY 2027 onwards. Whether we have submitted 300 trial wheels for the approval. From Q1 onwards, what kind of run rate we can expect quarter- on- quarter basis in terms of volume?
No, I think, 300 wheels we are supposed to submit in the month of June or July. I think, when Lalit said we are going to commence production, it means we are starting the plant, I think probably by end of May or June, wherein we will start manufacturing wheels and commercial production will start immediately. So 300 wheels, we don't need to wait, for 300 wheels to get approved. Once the 300 wheels are supplied, we can continue supply. This year we are looking at supplying almost 40,000 wheels, from that plant to the Indian Railways.
This will start from the coming financial year and onwards, right, sir? The 40,000 wheels will be reflect FY 2027 onwards.
FY 2027 onwards.
Okay, sir. What kind of utilization level we can expect, sir, of the INR 4.2 lakh? The 40,000 will be delivered in this financial year itself, right?
Yes. 40,000 will be delivered in this financial year.
I think then it will solve the whole industry problem. It's the right way to understand, sir?
I don't know about the industry problem. I think as per our contractual obligation, we are supposed to supply 40,000 wheels. We are gearing up to supplying 40,000 wheels in this year.
Okay, sir. Sir, on the diversification side, I think we are targeting 10%+ kind of revenue from PV in the next two years. Also are trying to be a primary supplier for EV, CV makers and aerospace alloys trials also began. I'm trying to understand, like what kind of specific defense or aerospace contracts we are focusing on? W hat kind of contracts we are focusing to get post aluminum forging commissioning side?
No, already I think, post commissioning of aluminum forgings, we have already started bulk supplies to EV suppliers, EV equipment manufacturers globally in terms of the needs of aluminum forgings. We are also developing few more aluminum forgings from that facility to supply to these EV manufacturers globally. In terms of other alloys, we are looking at getting into aerospace. We are, we have already set up a capacity to manufacture titanium and other stainless steel products. W e are bidding for several opportunities within domestic market as well as global market for. Right now we don't have any contract per se to basically have any realistic numbers to this. Y es, we have already set up a facility. We are already in talks with several OEMs globally and within India to buy higher alloy material basically for aerospace activities.
Yes, sir. Sir, on the capacity utilization side, the forging utilization, it's mentioned nearly 70% in Q4. If you look at last year Q4, it's 83%. If you look at cold forging, the capacity utilization is almost 40% kind of range. Like, if you could share how we are going to ramp up to 80%-85% kind of range by FY 2027.
No, I think, the, vis-à-vis last year when you compare, you have to also take in account the capacity of 8,000 ton plus and other addition in terms of overall forging capacity which we have had.
Mm-hmm.
Basically this capacity utilization is going to happen with firm order book already in place. We are very hopeful that this year we will have a much better utilization vis-à-vis the last quarter. In terms of cold forging, we are at 40% because approvals in cold forging is mainly to the Passenger Vehicle sector, and this is taking more time in the global market to get approvals in place. As and when approval gets in place, we are, utilization will improve. I, to be putting a timeline to it, I think we are not able to do that. We are pretty hopeful by this year-end, we should be having close to around 75%-80% utilization from cold forging also.
Got it, sir. Thank you, sir. Thank you so much for the detailed explanations. All the best.
Thank you. The next question is from the line of Aditya from Old Bridge Mutual Fund. Please go ahead.
Hi. Thank you for the opportunity, and congratulations on a good set of numbers, sir. My first question is on the presentation that you have shared. It has been showcased that INR 1,550 crore of new orders will be executed in FY 2027. Does that include castings also or is it only forging standalone business that it is showing?
No, it is consolidated forging and casting together.
Okay. How much castings volume are we expecting this year? We will be sitting on significant capacities of 78,000 tons. Earlier also we have indicated that we have an order book for that. How much are we expecting this year?
We are looking at almost, 85%-90% utilization in casting over the quarters, in coming quarters in this year.
80%-90%. close to around, I would say 65,000 tons, 65,000 tons, 70,000 tons.
Close to full utilization, I think. Very safe to say.
Okay
We are looking at close to full utilization this year.
Okay. That's great to hear. That's basically around, if I take that number, then that's basically around incremental INR 900 crore of revenue from castings.
I will not put a number to it, but we are safely looking at almost 85%-90%-
Yeah
... utilization in the full- year basis.
Yeah, because I got, yeah.
First quarter, it may not come in the first quarter itself, gradually over next two quarters because samples, approvals and other things are taking some time. We are looking at by first half almost to reach there.
Sure. I came to that number because of the realizations that have been shared on the presentation. I came to that number on that basis.
Yeah.
What kind of margins can we expect here, sir?
No. from margin for casting?
Yes.
Castings is, I think, Lalit, I think you will be able to tell better, Lalit.
Margins in the casting will be somewhere around 15%-16%, Aditya. In terms of what you are asking in terms of top-line growth, see 62,000 tons is the capacity, and we have already produced 26,000 tons for the last year, but that's the production. In terms of sales is always lower due to the machining mix, we expect another INR 400 crore-INR 500 crore revenue for the full year from the casting business on that.
Okay. Okay. Okay. Okay. That's pretty clear. On the cash flows part, what kind of CapEx are we looking at this year, and what is the net debt target for FY 2027? I feel most of the investments have been done now with the good business going ahead, good business model going ahead, we should be looking at debt reduction, if you can help us understand that.
Certainly we are looking at a quite significant debt reduction in this year on the back of promoter funding and that and good performance, all this. We are looking to reduce the debt by at least INR 400 crore-INR 500 crore in this year.
Okay. Okay. Okay. One bookkeeping question, sir. As mentioned in the presentation, there is some casting business sitting in the standalone business and some sitting in the and other part sitting in the console part or the subsidiary. Out of the 16,600 tons that we have sold this year, how much of that would be in the standalone, if you can help me with that number?
Standalone business commenced just on March 31st commercial production. Nil from the standalone on FY 2026. Okay.
Okay. Okay. Got it. Just one last question, sir. This is on the other business. We also started one trailer axle business a few years back. If you can help us give us some update, like what kind of revenues have we clocked from the trailer axle business in FY 2026 and what's the progression there and what kind of market share and target we are looking for in FY 2027?
I think trailer axle, we roughly had around INR 120 crore business from there in last year. Roughly, exact figures I don't have right now.
Mm-hmm.
At the market share, I think we are at about 4% or 5% market share. In two years, we have been able to make a good amount of inroads and satisfaction amount. This being a first B2C business for us, I think we are pretty satisfied with the performance of getting into around 4%-5% market share.
Mm-hmm.
This year we are looking at almost doubling this business to INR 250 crore and to a market share of about 10%.
Market share of 10%. Okay, sir. Okay. Thank you.
Thank you. A reminder to all participants, to ask any question, please press star one. We have next question from Ayush Goyal from CAVI Capital. Please go ahead, sir.
Yes. Hi, sir. Thank you for taking my question. My first question was regarding the presentation. Like in this quarter's presentation, the orders that are split over the next four years for FY 2027 is INR 1,550 crore. For the, like, in the last presentation it was INR 2,200 crore. Like, there's an INR 600 crore reduction. Have any of the orders been revoked or something?
No, no. Ayush, how it works, it was incremental order. Last presentation, what you stated for that was incremental order for FY 2026, which has gone. Residual order has come here in FY 2027.
Okay. Basically the order was executed, earlier than expected.
No, no, early. See, what you are looking at FY 2028, again, it is in INR 2,800 crore. INR 1,300, INR 1,100 crore incremental over FY 2027. Do you understand that?
Okay. Okay.
Incremental every year. I hope you understand that?
Okay. Yeah, got it, sir. Like, with the new added capacity in the press segment, how do we expect the utilization to improve going forward? Like quarter-on-quarter, what percentage can we expect?
No, on a full- year basis, I think, it is not right for us to say quarter- on- quarter. It's very difficult because of the approvals and other things-
Yeah.
...safe for us and better for us to say that by this year end, this financial year end, FY 2027, we are looking at almost 85% utilization in our press plant.
Okay, that's great. One last question I had. Like with the rising commodity prices, what effect does it have on our P&L? Like when we book an order, we take an order on the spot price, right?
No, I think it basically for, as earlier also expressed, all our pricing is based on pass-ons.
Okay.
With a quarter lag we pass on all the price increases of commodities. Basically mainly for a commodity for us is steel. Steel is pass-on for us every quarter.
Okay.
Other.... Largely our margins will be not affected by this. Other commodities like consumables like gas and other things are basically which affects our bottom line.
Okay.
That is on a yearly basis we are discussing with customers and I think most of our customers agree with the current scenario because of this geopolitical issue. We are expecting compensation on account of all these geopolitical issues in terms of price increases to come to us soon.
Okay. Thank you so much, sir. That's all from my side.
Thank you. The next question is from [Kiran Nayak] from Mody Fincap. Please go ahead.
Thank you for giving me an opportunity, sir. Sir, can you give me a rough idea what will be the revenue growth in FY 2027?
No, I think, we will not be able to give any number to FY 2027, but with the current order book and with the current capacities in place, we are looking at continued growth trajectory and we are looking at a healthy growth in FY 2027.
Okay. EBITDA margin for 2027?
It will continue to, I think, with what, if you have seen quarter-over-quarter 200 basis points we have improved in terms of our EBITDA margins. I think, with the current scenarios in place we are looking for a healthy growth in both our top line and the bottom line of the company.
Okay. Thank you, sir.
Thank you. The next question is from Darshil Jhaveri from Crown Capital. Please go ahead.
Hello. Good evening, sir. Thank you so much for taking my question, sir. Firstly congratulations on the great set of results, sir. Just wanted to, like confirm, like in terms of casting when you're saying we'll be at near full utilization. Did I hear correctly, sir, we could do nearly INR 900 crore of additional revenue from that, sir?
No, no. I, we have not put any number to it. I think Lalit has clarified all, out of the 70,000 odd tons of casting capacity already current utilization we are getting a significant revenue. Additional casting capacity which has come in by end of March, this is going to create a.. At the current commodity levels, an INR 400 crore-INR 500 crore revenue in the coming years.
Okay. The new March capacity would be around INR 400 crore-INR 500 crore. Sir, sorry, but I'm a bit new to the company. When we talk about the wheel sets, wheel sets we are expecting to do around 40,000 wheel sets. What are the unit economics of it? Like, is this on the similar margins that, you know, that our company does on a consolidated level? Also, in terms of what is the selling price? Sir, could you help me with that, sir?
I cannot give you the selling price, but I can tell you that, the wheels are in a similar trajectory of the forging business we do right now, and it is a new CapEx. This year we have set up a capacity for 230,000 wheels. This year, Railway offtake guarantee is for 40,000 wheels, which we are getting ready to supply in this financial year.
Okay. Okay. Is this like on a dot basis, the incremental revenue would be how much from the wheel sets, sir?
I think selling price, it is right now very difficult for me to tell you because we will need because the contract was awarded two years back. We will need to have a real time pricing done with two years of inflation and other things to capture and get to the new pricing. I will not be able to give you the exact number right now, but we should be anything between INR 400 crore- INR 450 crore roughly in terms of revenue from the wheel plant.
Okay. No, fair enough. That's fair enough. Yeah. That's it from my side, sir. Thank you so much.
Thank you. The next question is from Sunny Gosar from MK Ventures. Please go ahead.
Thank you for taking my question and congratulations on a good set of numbers for the quarter. My first question is on the overall peak revenue potential. We've almost now expanded to about 4 lakh tons of capacity. Assuming a normalized utilization and adjusting for seasonality in the business, what is the peak volumes or peak revenue? If you can give some color either on one of them over the next two to three years we can achieve with this current capacity that we have already set in place.
No, I think Sunny, putting a revenue number, I think it is difficult. Depends. Revenue number is absolute dependent on the commodity pricing. In terms of utilization, we are looking at almost 80% utilization this year in terms of our capacity. Means, close to around 350,000 tons of overall forging and casting put together in terms of our utilization. I think that's the ballpark we are working with.
Got it. Got it. Second question is, in terms of the domestic and export mix. This year, our domestic business performance has been very strong with strong CV demand. The mix, which used to be about 40%, about 40%-42% export and 58%-60% domestic, has seen a swing towards higher share of domestic. Based on the current visibility, in terms of the order book or customer discussions that you are having, how do you see this domestic export mix moving over the coming one or two years? How does the domestic export mix impact the overall margins? Does higher export mean better margin profile, and how is the outlook on that?
I think, with the current trend in the overall overseas market and with the new order wins in the European market, we are expecting in next two years, our export mix to significantly improve. I think, historically, which was 60/40, I think we are looking at going above 40% in terms of our export volumes in the overall scenarios, current scenarios. Our export is always higher remunerative than the domestic market. We are very confident with the current order book and with whatever is playing around in terms of the overall global market and the demand side. We are very confident that our margins also will considerably improve going into coming quarters. It may not happen immediately. Into going on to next eight quarters, roughly two years, our margins should be significantly improved with export volumes better than previous 40%.
Got it. Got it. That's very helpful. My last question is around the capacity and the CapEx. Basically, our utilization in the last quarter was around 65%-70%, and we have already expanded capacity. How do you see the CapEx intensity for, say, FY 2027 and FY 2028? We've spent about INR 800 crore plus of CapEx over the last two years. How will that number look like, say, in the next two years?
Sunny, this year we are looking at more of consolidation. I think with the contribution in JV, we are not looking at maintenance, we are not looking at CapEx of more than INR 300 crore-INR 400 crore, maximum to the tune of INR 400 crore. That also maybe most of may get into only value adds and our contribution to the joint venture. Most of our thrust will be in terms of debt reduction. Lalit has already given a ballpark of close to INR 400 crore-INR 500 crore of debt reduction over this financial year. I think this year, by this financial year-end, we should be anything above 80%-85% in terms of our existing capacity utilization. From wherein in FY 2028 we are looking for further CapEx to grow the business into the next level.
Got it. Got it.
We have not yet basically frozen any CapEx plan for FY 2028 right now. Still we are talking to customers and getting their feedback in terms of what next to do in terms of the overall capacity requirements.
Got it. In terms of our cash outflow, whatever contribution had to go for the JV, has that been paid for or there is more equity that is yet to be paid?
Some more part is left. I think, Lalit, can you give the exact number?
Yeah, about INR 50 crore will further go, Sunny, this year.
Got it.
Taking that INR 50 crore, Sunny, that, the ballpark number is around close to INR 400 crore of CapEx is taken into account of that INR 50 crore.
Got it. This is very helpful, and all the best for the coming quarters and the year ahead. Thank you so much.
Thank you. The next question is from Kumar Saurabh from Scientific Investing. Please go ahead.
Hello, am I audible?
Yes, you are.
Yes, you're audible.
Sir, I have one question on the aluminum capacity which is there. In terms of realization or margin, how is this business?
Realization is a commodity price itself is close to around INR 400 per kg. Obviously realization per ton is going to be always higher because of the commodity pricing. Margins are close to around 14%-15% at the absolute numbers.
Okay. Okay, almost similar to our current business.
Overall, in terms of contribution, I think is much higher because, 14%-15% you get on the INR 400 per kg also. Overall, I think contribution is much higher than the current ones.
Okay. Okay. Sir, I think, currently our all total fixed asset is around INR 4,000 crore. Historically, I think if we take a blended fixed asset turnover, it's somewhere around 1.5-1.6, which takes us to almost INR 6,000 crore revenue. I'm not looking for exact number, but ballpark kind of number. Like, do you have any plans that when you want to utilize this full capacity, given we have done with some major CapEx and now, you know, this is time to reap all the CapEx which we have invested?
We are looking at during this year, I think by third quarter or fourth quarter to reach close to 80%-85% plus utilization in terms of our overall capacity.
Sir, historically, when we shift from, let's say, you know, say 70% kind of utilization number to a peak utilization number, historically we have had higher margins. I know you have said that, and this quarter also we have done well on margin and, you know, you are expecting it to improve. Do you see possibility of going back to the previous highest utilization peak margins?
I will not put a number to it, but, we are very confident of continuing to improve in terms of margins. I think that is what best we can guide for right now. We continue to work on margins, and I think, rest, I think in terms as utilization improves, as we start, delivering the numbers, margins are going to be much better than what is expected.
Great. Great. Sir, I think in our business casting and forging energy is a major cost item and giving whatever is happening globally in terms of, you know, the whole energy thing. Do you see any major pressure on the expense side because of energy or like, how do you see it panning out in next few-?
Raw material is completely pass on for us. With a one quarter lag, it's completely pass on for us, so we don't get affected by the raw material increase. In terms of other consumers, major consumers in terms of commodity is gas for us, post the raw material. To my earlier question also I answered. With the current geopolitical issues, we have gone back to the customers in terms of force majeure clauses, and we are very pretty hopeful that the customer will compensate us to the maximum possible in terms of the gas energy price increase.
Great. Thank you a lot, sir. I'll come back in the queue. Wish you all the best.
Thank you. The next question is from Vinil Shah from Dalal & Broacha. Please go ahead.
Hello sir, good evening. Thank you for the opportunity. My question was in respect of realization for our forgings. Even if we take our annualized capacity utilization, we are already close to 70% or 74% capacity realization as per our presentation, if we take the annualized installed capacity. Yet our realizations have been lower than the Q4 of FY 2025. Even if we move forward with a higher capacity utilization, how do we plan to improve our realization of rupees lakhs per ton, sir?
I think realization also is affected by the commodity price. I think realization is not absolutely. Realization is directly linked to the commodity price. If the whole year has been, you must have seen that raw material prices continued to decrease. With the decreasing trend of raw material pricing vis-a-vis FY 2025, that is the effect which we have had. In terms of product mix, I think we have had a much better product mix in the second half of the year of this financial year. I think we have done much better than what presumably would have been with the current commodity price if the product mix would not have been what it is right now.
No sir, because my confusion was because our export realization have increased from INR 1.77 lakh to INR 1.85 lakh.
Both the things, I think, exports realization are always much better. If you see the previous year, exports were higher than this current financial year. As a percentage. As the export grows, automatically the realization, overall realization is going to be much better than what it is currently there.
All right, sir. Thank you. That's all from my side.
Thank you. The next question is from Mr. [Saket] from Sabre Cap. Please go ahead.
Hi. Am I audible?
Yes, you are, sir.
Yeah. First question is pertaining to the Non-Auto order wins. Almost INR 250 odd crore order have come from energy segment. Can you just explain what exactly, like, what kind of order is this within the energy space?
Milesh, can you answer this question, please?
Basically, as you know, energy storage has become the latest trend in the market, and we have received a lot of orders from companies which are doing very good in energy space in the North America market. They have a very ambitious plans with regard to the energy storage devices, and these devices actually require a lot of forging and casting as a mix in order to go forward there. We have received a good order book on account of it, and that's what we have reflected in the order books.
Okay. Thanks for the clarification. Sir, last time, when we talked about, you know, the turnaround within the U.S. business, we talked about largely the new customers or the new wins which were helping us, you know, come back slowly on growth. That also shows up in the numbers. Almost, QoQ there has been a growth. Going for FY 2027, are our, with the tariff behind us now, and as Naresh sir also talked about, you know, coming revival of demand as far as classic trucks is concerned. Do you think FY 2027 could be a normalized year from a U.S. export or a North America exports standpoint? It could be a, even a growth year, given that, you know, Mexico is I think likely to go live in two weeks, if not two months.
It will be a growth year. I think it will be a growth year vis-a-vis previous year in terms of our own North America performance as per se.
That's great to hear, sir. Sir, another question that I have is pertaining to, I think mainly for CFO sir. There is a, you know, given in the notes of the results, there has been some loss provisions that we have made vis-a-vis tariffs that some of our customers have had to bear. Can you explain something pertaining to the ECL? What exactly is this?
See, we have made a provisioning of ECL for INR 42 crore in this quarter as basically this is in light of income of electricity duty, which we got order in the last quarter, and the income has been recognized as exceptional income. We did not wanted to carry it into our profit. On a prudent basis, considering the current economic scenario and whatever the volatility we have in the global environment, we just provided as ECL on our receivables for this INR 42 crore amount. This amount is totally receivable, still, we got this headroom to provide for this. This will help us in future only.
Okay. Thanks for the explanation. Coming back to the shipping time. How is the shipping time? Is it now back to normal, especially for the U.S. side, or is it still on the higher side? How is the cost, you know, for shipping cost right now?
Shipping cost has gone up by about 15%-20%, and the days have increased by almost 15-20 days.
Okay. Sir, because last time, when this happened, a lot of our floating inventory ended up becoming on our books. Right now, how is that floating inventory right now? Is it in line, or do you think that should be fine going forward?
It is in line.
Okay. sir, do we have any West Asia exposure in terms of clientele or revenue?
No. No revenue and no exposure.
Okay, sir. Thanks. Sir, last question is, you know, you have elaborated a bit on the titanium and that, those kind of alloys where RK Forging is foraying into. It's good to know because again, aerospace is gaining a lot of traction. But these are also long gestation period because approval times are quite longer. When do we think that, you know, this would end up, say, adding something substantial to our top line, or at least in the order book will start reflecting, say, in the order book? Any sense or color on that?
I think in terms of order book, I think by this financial year end it will start reflecting in our order book. In terms of our revenue in terms, I think it will take additionally, I think 12-24 months, because these are long lead items to make also and get approvals. We are not looking anything in terms of our revenue before FY 2029.
Okay, sir. Now come, sir, specifically to the EV segment, because it is now kind of making some sort of a comeback, right? Both across Europe as well as even U.S. had a reasonable quarter. Now how are those EV focused order or revenue looking up? Are we looking at, say, much better contribution from them going forward?
I think EV is performing extremely well for us, both in the domestic market and overseas market. I think, as our diversification strategy and as well as our dependence on ICE, to decrease the same, we are already working very aggressively to improve our Passenger Vehicles portfolio, which is mainly constituting of EV segments only. I think we have already guided for a 10% revenue in two years' time from, to come from, basically Passenger Vehicles segment.
Okay. 10% PV is synonymous with 10% EV at an overall level. Is that a fair understanding?
Fair understanding.
Okay, sir. Thanks, sir, for responding, and best of luck for the coming quarters.
Thank you. The next question is from Kiran Gadge from Knightstone Capital Management LLP. Please go ahead.
How much revenue did you generate from railway assembled undercarriage for the full year?
Can you repeat the question, please?
How much revenue did you generate for the railway assembled undercarriage for the full year?
We will not be able to give you exact, component-by-component revenue achievement. We have achieved a significant portion of Railway business as an overall. 7.5% is overall in terms of our Railway business, which is performing, and we are looking at double-digit almost to achieve the number by this year from railways.
Okay. Thank you.
Thank you. The next question is from [Kiran Nayak] from Mody Fincap. Please go ahead.
Sir, thank you for giving me an opportunity again. Sir, can you tell me from where you are buying aluminum, which is your raw material for forging?
We are buying from Hindalco.
Hindalco. Only one supplier you have or you import also?
We basically are customer-directed buyer.
Okay, okay. Thank you, sir. Thank you.
Thank you. The next question is from Kunal Bhatia from Dalal & Broacha Stock Broking Limited. Please go ahead.
Yeah. Hi, sir. Thanks for the opportunity. Sir, I just had a clarification question. You mentioned that this time around you will be having almost an 80% utilization on your capacities of 350,000 odd tons. But what is your target which you are expecting in terms of the overall sales volume? Because
Sales volume.
Yes, sir.
Sales volume, I think every quarter-on-quarter you will see significant improvement. I think in terms of percentage is very difficult to say. We are very confident whatever we'll make, we'll be able to sell that.
Okay. Because even in the last conference call, if I'm not wrong, we had mentioned an upper limit of 10%-15% kind of growth for FY 2027 and FY 2028 in terms of a CAGR. Yeah.
With the current order book, we are very confident of surpassing. We are not trying to put any number to it right now, but I think, with the current geopolitical issue going on, it is a risk also. With the current order book, we are very confident of growing. With the capacities in place, we are looking at achieving those tonnages in terms of our production plans, and we are very confident to sell those.
Okay. Okay. It's fair to assume that we'll be growing higher, upwards of the 15% number.
I will not put a number to it.
Okay.
I think, we are looking at a decent and very good growth in FY 2027.
Okay. Sir, ballpark on an 80% kind of utilization levels, what is the kind of leverage in terms of margins that kicks in, assuming every other thing remains status quo?
I think the current margin, which we have been able to achieve in the fourth quarter, I think now it's here to stay and we are going to do better margins than what we have achieved right now in this quarter. I think as the capacity utilization, economics of growth come continued scale and everything remains as where it is, and we are able to pass on the energy price increases which have happened, we should be at least 100 basis points- 50 basis points better than what we have done right now. It all depends on whether we are able to pass on the energy price increases.
Okay. Sir, you would have some fair bit of an idea from your current month's export, say, in April, May. Have you been able to get those better or higher realizations?
I think we have not yet been able to pass on the energy price increases. We have already had discussions and the discussions are in advanced stage. Beyond that, I think it's very difficult for us to say anything that whether by when we will be able to get. Whatever we will get, we will be able to get from 1st April onwards. Exactly how much and by when, it is very difficult for us. Because it is industry-wide which is going to happen. It's not going to be happening for us as an isolated case. Whatever the customer approach, OEM approach takes, it is to be happening in the industry-wide space. I think we will wait for some time before we can comment on it.
Okay. Okay. Sir, my final question, I am not asking you for a particular number, but in terms of volume on the export business side, looking at the current situation, how has been, say, the month of April, which has already gone by? Was it better than March or things are not?
I think it's very-
Yeah.
I will not be able to give you a reflect on anything on the current numbers. I can only say this year, FY 2027 export volumes are going to come back and it is extremely strong. We are very confident of doing much better exports than our previous, in terms of overall mix of percentage to sales. We are going to do much better than what we have done in previous years and quarters.
Okay. Okay. Sounds good. Thank you, sir. Thank you so much.
Thank you. The next question is from Mr. Kushal from Asian Broking. Please go ahead.
Good evening, sir. Hello.
Yes.
Hello.
Hello.
Yes.
Yeah, are there any plans to increase ring rolling capacity?
No, I think there is no plans right now in this year, this financial year, to increase our ring rolling capacity.
Okay, thank you, sir.
Thank you. The next question is from Mr. Aditya from Old Bridge Mutual Fund. Please go ahead.
Sir, just one clarification. The orders that you have won of INR 323 crore on the domestic CV part, on the CV part, how much of that would be domestic and how much of that would be exports?
Milesh?
Can you repeat the question, please? It's not very clear.
Yeah. Yeah, yeah. I was asking the INR 323 crore order that we have won on the CV side, what would be the split between domestic and exports?
Against the INR 323 crore, the CV would be more than 50%. In the CV, more than 50% it is export and around 50% is from the domestic.
Okay, cool. Thank you. That's it.
Thank you. We have the next question from Mr. Kushal from Asian Broking. Please go ahead, Mr. Kushal.
Hello.
Yes, sir. You are audible. Please go ahead.
Yeah, yeah. Just again, regarding ring rolling, as I'm seeing here it's at 121% utilization. Does it affect in any way negatively crossing the capacity?
No, it basically it is 121%, I mean, you have if you see the history also, ring rolling has been operating at more than 100% as always, and, it does not affect, in terms of the life of the equipment or in any way.
Thank you, sir.
Thank you. As there are no further questions in the queue, I now hand the conference over to management for closing comments. Over to you, sir.
Thank you. We would like to thank all for taking out the time and joining our earnings call. We hope we have answered all your queries and for your satisfaction. We would like to further inform and get in touch with us or [NCR] if you have further information required. We look forward to interacting again next quarter. Thank you again very much for talking to us. Thank you.
Thank you. On behalf of 360 ONE Capital Market Private Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines. Thank you.