Ramkrishna Forgings Limited — Credit Ratings, 08-05-2025: Credit Rating

ICRA has placed Ramkrishna Forgings Limited’s ratings on Rating Watch with Developing Implications due to a significant inventory discrepancy of Rs. 120-150 Cr, representing about 4-5% of net worth. This adjustment is likely to slightly reduce profit margins and debt coverage ratios in FY2025, though partially offset by a Rs. 95 Cr subsidiary divestment and tax benefits from a recent merger. While total debt/OPBDITA may rise marginally above 1.5x in FY2025, leverage is expected to improve and remain comfortable from FY2026. Liquidity stays healthy with low working capital utilization, but rating pressure could increase if the discrepancy proves larger or indicates governance concerns.