Kalyani Forge Ltd reported a 218% year-on-year surge in profit after tax (PAT) to ₹4.48 crore in Q1FY27, compared with ₹1.41 crore in the corresponding quarter last year, as tighter cost controls and improved operational efficiency strengthened profitability.
Total income rose 3.9% year-on-year to ₹67.07 crore in the quarter ended June 30, 2026, from ₹64.53 crore in Q1FY26. Total income was also higher than ₹59.24 crore in the preceding quarter.
Profit before tax (PBT) more than tripled to ₹6.15 crore, up 203% from ₹2.03 crore in Q1FY26. PBT was marginally higher than ₹6.13 crore in the preceding quarter.
Margins strengthen
Kalyani Forge’s EBITDA margin expanded to 16.2%, an improvement of 640 basis points from the year-ago quarter. Return on Capital Employed (ROCE) also improved to 22%, crossing the company’s 20% target for the first time.
Basic and diluted earnings per share stood at ₹12.31 for the quarter.
Kalyani Forge Ltd, Managing Director and CEO, Viraj Kalyani, said Q1FY27 marked the company’s strongest opening quarter in recent years, with PAT more than tripling year-on-year and ROCE crossing 20% for the first time.
He attributed the improvement to the company’s new inventory policy, tighter cost controls and continued focus on strategic accounts, which he said were translating into gains in margins and capital efficiency.
₹19.1 crore cost savings
The company’s internal ‘Vriddhi Council’ has generated ₹19.1 crore in savings so far, against an annual target of ₹50 crore.
Kalyani Forge is also working to improve Overall Equipment Effectiveness (OEE), particularly in its Forge Shop, as part of its cost-reduction programme.
Working capital improves
The company’s cash conversion cycle improved to 148 days from 168 days in the preceding quarter, with a longer-term target of reducing it to 120 days.
Trade receivables stood at ₹124.21 crore. The company is using bill discounting frameworks, tighter credit controls and enhanced collection monitoring to improve receivable realisation and liquidity.
New orders add ₹20 crore revenue potential
Kalyani Forge has secured new orders from marquee global customers for engine and wheel hub components, representing approximately ₹20 crore in potential annual revenue.
The company said the orders are progressing alongside a disciplined, low-capex approach to capacity expansion.
It has commissioned a second conrod production line for a key customer programme using existing infrastructure, requiring no additional capex. Similarly, the ongoing wheel hub line expansion is being executed by redeploying existing machining assets, reducing the planned capital expenditure from ₹10 crore to approximately ₹2 crore.
Focus shifts to execution
While the company acknowledged a recent reduction in its driveline business, it is developing prospective growth areas to diversify its revenue base.
For Q2, management’s priorities include improving OEE in the Forge Shop, accelerating collections and converting the strengthening order pipeline into revenue.
Kalyani Forge manufactures precision forged and machined components for automotive and industrial customers in India and overseas markets, with expertise spanning high-precision metal forming, forgings, machined components and sub-assemblies.