Ramkrishna Forgings Ltd. Stocks traded 2% higher on April 4, when the company started commercial production of 4,500 metric tonnes (MT) of 630 Tonnes Press Line and 13,750 MT of Maxi Press 6,000 Tonnes Press Line at Ramkrishna Forgings Limited – Kharswan starting from April 3 2024. This will increase the company’s production capacity by 18,250 Tonnes Per Annum (TPA).

The total production capacity of the company will now be 229,150 TPA.

The total existing capacity is 210,900 tonnes, and existing capacity utilisation as of December 31 2023, the company had a utilisation of around 95.60%. The proposed capacity addition is 18,250 Tonnes. The period within which the proposed capacity is to be added is starting from April 3 2024.

Investment Required: The Company has invested around Rs. 54.59 Crores to make the capacity addition as per the Capex plan of the company.

Mode of Financing: The investment has been financed by a mix of equity and debt.

Rationale: The 630 Tonnes Press Line will help the company to strengthen its presence in Warm Forgings. The 6,000 Tonnes Press Line will enable the company to meet additional demands from the customers.

Earlier on February 22, 2024, the company received board’s approval for commencement of manufacturing and supplies from the Company’s Mexico location. The above operation in Mexico was backed by a 10 year USD 3.5 million per annum. The agreement for machining components with a North American customer, solidifying the company’s commitment to delivering excellence and reliability in products and services.

However, at 3:16 pm, the shares of Ramkrishna Forgings lost all its early gains and were trading 0.092% lower at Rs 707.85 on NSE.