1. At a Glance
Welcome toM M Forgings Ltd, the company that began its journey selling Royal Enfield bikes in 1946 and now forges steel strong enough to handle India’s bumpy GDP growth. The stock, currently flexing at ₹313 (as of Nov 21, 2025), is down a bruising31.7% in one year— proof that even iron needs polishing. With amarket cap of ₹1,512 crore, anEPS of ₹22.4, and aP/E of 14, the company is sitting in the middle of an auto-components steel ring where Bharat Forge and Schaeffler throw punches at triple its valuation multiples.
For Q2 FY26, the company reportedRevenue of ₹370.6 croreand aPAT of ₹17.7 crore, a YoY crash of~50.7%in profits and a 3% dip in sales. That’s like taking a torque wrench to your margins. Still, withROE of 15.6%,ROCE of 12.5%, andDebt-to-Equity of 1.25x, M M Forgings is that gym bro with heavy loans but a strong core.
The question: Can this once-polished forging veteran hammer its way back to glory — or has it overheated its press machine?
2. Introduction
M M Forgings’ story is classic old-school Indian capitalism — started as a Royal Enfield dealer and pivoted to heavy-duty steel forgings when the auto craze caught on. Imagine quitting bikes and deciding to literally build their bones instead — talk about vertical integration at emotional level.
Over 79 years, this Chennai-based veteran has gone from retailing motorcycles to supplyingforged steel componentsto almost every category of vehicle that moves (and some that barely do). Fromfront axle beams for truckstoconnecting rods for tractors, M M Forgings quietly powers the industrial heartbeat of India — the parts that never get Instagram fame but always get the grease stains.
But FY25–26 hasn’t been kind. Demand in Europe cooled, interest costs rose faster than a Royal Enfield’s exhaust, and capacity utilization stalled at~67%despite the company’s ten manufacturing plants. The ₹500 crore expansion plan sounds exciting, but with debt already touching ₹1,216 crore, one can’t help but ask — is this bold capex, or just another case of “forging ahead” without GPS?
3. Business Model – WTF Do They Even Do?
So, what does M M Forgings actuallydoapart from confusing new investors with its 1946 Enfield origin story?
The company manufacturessteel forgings— those heavy, heat-battered, shape-shifted metal parts used in cars, trucks, tractors, and industrial equipment. It does this inraw, semi-machined, and fully machined stages, using every steel grade from carbon to micro-alloy and stainless.
Let’s break down their product segments (FY23 mix):
- Passenger Car Components (10%)– sprockets, hubs, flanges. Basically, parts that go unnoticed until they break.
- Commercial Vehicle Components (81%)– front axle beams, steering arms, pivot arms — the heart of its revenue engine.
- Agriculture and Off-Highway Components (8%)– those rugged yokes and shafts that keep tractors ploughing and JCBs flexing.
In short: if it rolls, hauls, digs, or moves, there’s a good chance M M Forgings has heated and beaten a part of it.
Geography check:63% of revenue comes from India, and 37% from exports — meaning it’s half “Make in India” and half “Ship to Germans.”
And those 10 plants across Tamil Nadu, Uttarakhand, and UP? Together, they churn out 1.26 lakh MTPA capacity — powered by their own solar and wind farms. A forging company with renewable energy farms? That’s like a bodybuilder going vegan — unexpected, but efficient.
4. Financials Overview
Let’s hammer the quarterly numbers into shape:
| Metric (₹ Cr) | Q2 FY26 (Sep 2025) | Q2 FY25 (Sep 2024) | Q1 FY26 (Jun 2025) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | 370.6 | 389.0 | 349.0 | -4.7% | +6.2% |
| EBITDA | 63.0 | 77.0 | 63.0 | -18.2% | 0.0% |
| PAT | 17.7 | 36.0 | 22.0 | -50.8% | -19.5% |
| EPS (₹) | 3.67 | 7.44 | 4.63 | -50.7% | -20.8% |
Commentary:YoY profit fell faster than the rupee at an oil auction. OPM shrank to 17% from 20%, and while the top line
only dropped 5%, the bottom line melted by 50% — a clear case of input cost inflation meeting interest expense explosion.
If this were a boxing match, revenue merely tripped, but profits got TKO’d.
5. Valuation Discussion – Fair Value Range
Let’s forge our fair value range with calm hands and hot spreadsheets:
P/E Method:Current EPS = ₹22.4.Industry P/E ≈ 31.4; Company P/E = 14.So, if the market values MMFL at industry multiple:Fair Value Range = ₹22.4 × (14–28) = ₹314 – ₹627.
EV/EBITDA Method:EV = ₹2,495 Cr, EBITDA (FY25) ≈ ₹294 Cr.Current EV/EBITDA = 8.27x.Industry median ~12x.At 10–12x range:Fair EV = ₹2,940–₹3,530 Cr → Implied Equity Value ≈ ₹1,950–₹2,540 Cr → Share price ₹400–₹520.
DCF (simplified):Assume 10% growth, 12.5% ROCE, 9% WACC.Intrinsic range = ₹350–₹480 per share.
→ Educational Fair Value Range: ₹350–₹520.
Disclaimer: This fair value range is for educational purposes only and not investment advice. No chai was spilled in this calculation.
6. What’s Cooking – News, Triggers, Drama
Ah yes, the forging soap opera continues:
- Amalgamation Saga:M M Forgings loves mergers more than weddings. After absorbingCafoma Autoparts Pvt Ltdin May 2024, it announced themerger of DVS Industries Pvt Ltd(its wholly owned subsidiary) in early 2025. Expect more synergies, and maybe more board meetings with samosas.
- Capex Feast:The company is pumping₹500 croreover 12–14 months — ₹175 crore into core forging, ₹75 crore into electrical, and ₹250 crore into machining. 60% will come from internal cash flows (the muscle), and 40% from borrowings (the steroids).
- Bonus Issue:A juicy1:1 bonuswas declared in July 2024 — doubling shares, but not profits. Investors cheered, only to find EPS halved later.
- Green Energy:Their wind and solar farms (yes, in a forging firm!) now feed power to multiple plants, reducing costs and carbon guilt.
Drama takeaway:Expansion is bold, but debt is already hefty.
