MM Forgings Q1 FY26 Concall Decoded: Hot Metal Meets Cold Tariffs
1. Opening Hook
While most people worry about potholes in monsoon, MM Forgings is busy worrying about potholes in U.S. tariffs. Q1 numbers? Downshifted like an old truck on a steep slope—revenue, EBITDA, and PAT all slipped. But management insists “it’s not linear”—basically economist-speak for “God knows what happens next.” Spoiler: their 16,000-ton press is coming, even if orders aren’t. Stick around—this one’s part Bollywood drama, part steel mill documentary.
2. At a Glance
Revenue ₹358 cr (-6%) – Like steel prices, enthusiasm also cooled.
EBITDA ₹72 cr (-8%) – Margins shaved harder than a barber on EMI.
EBITDA Margin 18% (ex-other income) – Barely clinging to respectability.
PAT ₹22 cr (-31%) – Profits melted faster than ice cream in Chennai heat.
Debt ₹550 cr (flat plan) – At least borrowings aren’t ballooning… yet.
Production 18,000 tons (+4%), Sales 17,800 tons (-11%) – Made more, sold less. Classic inventory story.
3. Management’s Key Commentary
CMD Krishnan: “Times are extremely volatile with tantrums from the USA.” (Translation: Uncle Sam’s tariff mood swings are worse than Twitter outrage cycles.)
“We produced 18,000 tons, sold 17,800 tons, realisation fell to ₹1.92 lakh/ton.” (Selling more tons at cheaper rates—welcome to capitalism, forging edition.)
“Capex trimmed to ₹150–200 cr; debt to be flat at ₹550 cr.” (Translation: Wallet shut tighter than a middle-class uncle at a mall.)
“Domestic demand mixed; AC cabin pre-buying helped, then slowed.” (Norms drove sales, but now trucks are sulking like teenagers forced to wear helmets.)
“U.S. tariffs will hurt over time, but customers can’t switch overnight.” (Translation: For now, they’re stuck with us. Long-term, maybe hello Mexico.)
“Crankshaft output jumped from 1,500/month to 7,000; target 10,000.” (Finally, something forged ahead without tariff drama.)
4. Numbers Decoded
Metric
Value (Q1 FY26)
YoY Change
One-Line Analysis
Revenue – The Hero
₹358 cr
-6%
Sales cooled, not catastrophic yet.
EBITDA – The Sidekick
₹72 cr
-8%
Margins shaved by costs, tariffs looming.
EBITDA Margin – Drama
18%
-200 bps
Lost shine under power costs & mix.
PAT – The Victim
₹22 cr
-31%
Got hammered by higher interest & dep.
Debt – The Baggage
₹550 cr
Flat plan
At least balance sheet not ballooning.
Production – The Worker
18,000 tons
+4%
Mills kept busy despite weak sales.
Sales – The Odd One Out
17,800 tons
-11%
Customers playing wait-and-watch.
5. Analyst Questions
Anand Rathi: Tariff impact on U.S. customers? (Mgmt: “They’ll pull along grudgingly.” Translation: Breakup is coming, but not today.)
