Ratnamani's margin falls to 14.16% as costs outpace revenue
Consolidated profit declined 42.95% year on year, with other income contributing 26.87% of pre-tax profit.
Filed 15 May 2026, 16:32 IST · after market close · Ratnamani Metals & Tubes Ltd (RATNAMANI)
Key takeaways
- Consolidated Q4FY26 operating margin fell 5.05 percentage points sequentially to 14.16% as expenses grew 8.14% against 1.78% revenue growth.
- Net profit fell 42.95% year on year even as the 24.75% tax rate was lower, while other income contributed 26.87% of pre-tax profit.
- The stock fell 8.43% on the first session after results, far more than its 1.91% median move after the past eight results.
Price around the results
Q4FY26 profit fell despite modest sequential revenue growth
Ratnamani Metals & Tubes reported consolidated Q4FY26 revenue growth of just 1.78% sequentially, while operating profit fell 24.96% and net profit declined 14.38%. The year-on-year comparison was weaker: revenue dropped 36.75%, operating profit fell 49.15% and net profit declined 42.95%. Management said sales were lower than the previous year's record quarter and attributed the operating environment to muted demand and geopolitical developments in the Middle East.
Costs drove the sharp margin contraction
Sequentially, expenses rose 8.14% against 1.78% revenue growth, narrowing operating margin by 5.05 percentage points. Year on year, expenses fell 34.10%, but revenue fell faster at 36.75%, reducing margin by 3.46 percentage points. Other income rose 219.37% sequentially and 354.34% year on year, accounting for 26.87% of pre-tax profit; this made reported profit less reflective of operating earnings. The 24.75% tax rate was 1.62 percentage points lower than a year earlier, partly cushioning the net-profit decline, but 1.20 percentage points higher sequentially.
Margin reversed after two quarters of improvement
Operating margin had risen from 16.34% in Q1FY26 to 17.73% in Q2FY26 and 19.21% in Q3FY26 before falling to 14.16% in Q4FY26. This quarter's margin was 1.50 percentage points below the 15.66% median for 71 Industrials peers that had reported. The sequential reversal is therefore more significant than the year-on-year decline alone, as it followed two quarters of margin expansion.
Subsidiaries were the reported growth drivers
Management said Ravi Technoforge and Ratnamani Finow Spooling Solutions delivered strong performances, with bearing rings and pipe spooling leading growth. The company said RFSS had an order book exceeding Rs 400 crore for execution over the next 12 months and was expanding annual spool capacity from 1,200 MT to 4,000 MT, with completion targeted for Q3 next year. Management also said Ravi Technoforge had completed a 20% capacity expansion at its Pipaliya unit, while a 9 MW solar plant was commissioned to supply 50% of its energy requirement from green energy.
The market reaction was unusually negative for Ratnamani
The stock fell 8.43% on the first session after the results, with a 4.95% opening gap and volume at 2.15 times the reference level. Across the past eight result reactions, the stock rose three times and fell five times, but the median absolute move was only 1.91%, making this reaction unusually large. The decline remained 5.78% after five sessions and 7.93% after 30 sessions.
Q4FY26 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹1,085 cr | ₹1,066 cr | +1.78% | -36.75% |
| Other income | ₹41 cr | ₹13 cr | +219.37% | +354.34% |
| Expenses | ₹931 cr | ₹861 cr | +8.14% | -34.10% |
| Operating profit | ₹154 cr | ₹205 cr | -24.96% | -49.15% |
| Operating margin (%) | 14.16% | 19.21% | — | — |
| Interest | ₹6 cr | ₹7 cr | -14.77% | -5.70% |
| Depreciation | ₹35 cr | ₹33 cr | +4.43% | +21.12% |
| Profit before tax | ₹154 cr | ₹177 cr | -13.02% | -44.18% |
| Tax | ₹38 cr | ₹42 cr | -8.56% | -47.61% |
| Net profit | ₹116 cr | ₹135 cr | -14.38% | -42.95% |
| EPS (₹) | ₹14.94 | ₹15.67 | -4.66% | -48.46% |
Operating margin of 14.16% compares with a Industrials sector median of 15.66% across 71 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -8.43% | -8.46% |
| Next session | -5.96% | — |
| 5 sessions | -5.78% | -7.42% |
| 15 sessions | -4.80% | — |
| 30 sessions | -7.93% | — |
Volume on the results session was 2.15× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- RTL and RFSS delivered strong performances, with bearing rings and pipe spooling emerging as key growth drivers.
- The company maintained its market position despite lower sales than the previous year's record quarter.
Guidance & outlook
- Enquiry levels are improving across key markets, and the company remains confident of sustaining growth and creating long-term value.
- RFSS is targeting execution of its order book exceeding ₹400 crore over the next 12 months.
Expansion
- RFSS is expanding spool manufacturing capacity from 1,200 MT to 4,000 MT annually, with completion targeted for Q3 next year.
- Ravi Technoforge completed expansion of its Pipaliya unit, increasing capacity by 20%.
- RFSS plans commercial production from its expanded capacity in Q4.
New products
- The company expanded its product range with API 5CT products and 18-metre HSAW pile manufacturing.
New initiatives
- Ravi Technoforge's Pipaliya expansion included mechanisation and automation to improve efficiency and productivity.
- Ravi Technoforge commissioned a 9 MW solar power plant, expected to supply 50% of its energy requirement from green energy.
- The company is expanding capabilities through 18-metre HSAW pile manufacturing and the API 5CT product range.
Problems & risks
- The company operated in a challenging environment due to muted demand and geopolitical developments in the Middle East.
- Order booking remained moderate, although enquiry levels were improving across key markets.
What to watch
- Whether operating margin recovers from 14.16% after the 5.05-percentage-point sequential decline.
- Progress on RFSS's order book exceeding Rs 400 crore and its planned capacity increase from 1,200 MT to 4,000 MT.
- Whether subsidiary-led growth can offset the muted demand and moderate order booking described by management.