Tirupati Forge Ltd Q3 FY26 – ₹493 mn Revenue, Defence Bet +50% PAT Spike, But 92 P/E… Forging Gold or Forging Illusion?
1. At a Glance – Forging Metal, Diluting Equity, Chasing Defence Dreams
If there was ever a company that screams “mid-cap ambition trapped inside small-cap execution,” it’s Tirupati Forge.
Here’s the scene: A forging company from Rajkot suddenly decides to enter defence manufacturing — not by dipping a toe, but by spending ₹670 mn (₹67 crore) on artillery shells. Meanwhile, promoters are quietly converting warrants like it’s Diwali bonus season. Revenue is rising, margins are dancing, exports are booming… but profits? Still stuck in “trying hard” mode.
And valuation? A spicy 92x P/E.
Let that sink in.
You’re essentially paying premium pricing for a company that:
Makes flanges (65% revenue… yes, flanges)
Has ROE under 10%
Is still figuring out consistent profitability
Is aggressively diluting equity
But wait — defence entry, export growth, solar cost savings — the narrative is strong.
So the real question is: Is this a future Bharat Forge junior… or just another “story stock” doing jugaad with shareholder money?
Let’s open the forensic audit file.
2. Introduction – Rajkot to Rockets
Tirupati Forge started in 2012. A classic Indian SME story:
Start with industrial components
Build export network
Slowly climb the value chain
Now suddenly — boom — defence manufacturing.
Because obviously, if you can make flanges, artillery shells are just… bigger flanges?
The company operates in:
Oil & gas
Automotive
Construction
Aerospace
And now… defence
Exports already contribute ~65% of revenue.
And guess what? More than 50% of exports depend on the US market.
So yes, your investment thesis now depends partly on:
US demand
Geopolitics
Defence budgets
And Rajkot manufacturing discipline
No pressure.
But here’s the twist — management sounds confident. Very confident.
They’re talking about:
Defence ramp-up
Capacity expansion
Strong inbound demand
Every SME CEO’s favourite word: “pipeline”
But investor question: Pipeline hai… ya pipe dream hai?
3. Business Model – WTF Do They Even Do?
Let’s simplify.
Tirupati Forge is basically a metal-bashing company.
They take raw metal → heat it → shape it → sell it.
Core products:
Flanges (oil & gas pipelines)
Gears and shafts
Earthmoving parts
Machine tools
Flanges alone = 65.5% revenue.
Which means: If oil & gas slows → company sneezes.
Now comes the twist:
Defence Entry
They are building:
155 mm M107 artillery shell bodies
Capacity: 1.5 lakh units/year
Commissioning: March 2026
Planned utilization:
50% in Q1 FY27
80% by FY28
Sounds great.
But here’s the catch:
No proven track record in defence yet
Heavy capex upfront
Revenue visibility still “interest-based” not “order-based”
