ROLEXRINGS - Rolex Rings

📊 NSE: ROLEXRINGS 🏢 Castings & Forgings 📅 Last Updated: 12/14/2025 12:26

💰 Financial Performance

Revenue Growth by Segment

Total revenue for Q2FY26 was INR 271.4 Cr, representing a 7% QoQ decline from INR 291.6 Cr in Q1FY26 and a 9.6% YoY decline from INR 300.3 Cr in Q2FY25. The decline was primarily driven by the US export segment where supplies were put on hold due to duty pressures.

Geographic Revenue Split

The US export market is a significant contributor but faced temporary headwinds in Q2FY26 due to duty issues. Domestic operations are centered in Rajkot, Gujarat, with the company being one of the top 5 forging companies in India.

Profitability Margins

The company maintained healthy margins despite revenue pressure; Operating PBT stood at INR 59.1 Cr (21.8% margin) in Q2FY26 compared to INR 68.0 Cr (23.3% margin) in Q1FY26. PAT for Q2FY26 was INR 44.3 Cr, down from INR 49.3 Cr in Q2FY25.

EBITDA Margin

EBITDA margin for Q2FY26 was 25.5% (INR 69.2 Cr), showing resilience compared to 25.1% (INR 75.5 Cr) in Q2FY25. The company focuses on high-margin products over volume to sustain these levels.

Capital Expenditure

While specific future CAPEX for Rolex Rings is not disclosed, the company monitors client CAPEX (e.g., INR 100 Cr units) to capture a 15-25% share of the component requirements for those new facilities.

Credit Rating & Borrowing

CARE Ratings reaffirmed 'CARE A-; Stable' for long-term facilities (INR 14.99 Cr) and 'CARE A2+' for short-term facilities (INR 135.00 Cr) as of August 2025. Total long-term bank facilities were reduced from INR 25.99 Cr.

⚙️ Operational Drivers

Raw Materials

Steel (forging quality) and bearing steel are the primary raw materials, though specific percentage of total cost is not disclosed in the provided documents.

Import Sources

The company is based in Rajkot, Gujarat, sourcing primarily from India, while export dynamics are heavily influenced by US trade proclamations.

Capacity Expansion

Current capacity is not specified in MT, but the company is focused on better utilization of existing production capacity for high-precision components rather than booking lower-margin products.

Raw Material Costs

Not disclosed as a specific percentage of revenue, but the company manages costs through value-added processes and precision manufacturing to maintain a 25%+ EBITDA margin.

Manufacturing Efficiency

The company achieved a 'Zero PPM' award from a US global giant for two consecutive years, indicating high precision and low rejection rates in manufacturing.

📈 Strategic Growth

Expected Growth Rate

11.60%

Growth Strategy

The company plans to regain the US export market starting December 2025 following a favorable October 2025 proclamation. Growth will be driven by capturing 15-25% of the component spend from Indian bearing manufacturers who are currently in expansion mode (CAPEX).

Products & Services

Forged and machined components, bearing rings, and automotive components for global and domestic bearing manufacturers.

Brand Portfolio

Rolex Rings.

New Products/Services

Focus on high-precision, value-added forged components for the expanded facilities of global bearing manufacturers.

Market Expansion

Targeting the regain of the US export market from Q4FY26 and expanding share in the domestic bearing manufacturer segment.

Market Share & Ranking

Ranked as one of the top 5 forging companies in India.

🌍 External Factors

Industry Trends

Global players are winding off or moving out of the forging and ring business, creating an opportunity for Rolex Rings to gain market share. Indian bearing manufacturers are currently in a CAPEX/expansion mode.

Competitive Landscape

Competes with other Indian and global forging players, but benefits from some competitors exiting the ring-forging business.

Competitive Moat

The moat is built on 3 decades of industry experience, 20+ year customer relationships, and high-precision manufacturing capabilities (Zero PPM awards), which are difficult for new entrants to replicate.

Macro Economic Sensitivity

Highly sensitive to global trade policies and US import duties, which directly caused the Q2FY26 revenue contraction.

Consumer Behavior

Shift towards high-precision and reliable supply chains in the auto-component and bearing industry favors established players like Rolex Rings.

Geopolitical Risks

Geopolitical reasons previously caused 'turbulences' in the export segment, though management expects these to be streamlined by Q4FY26.

⚖️ Regulatory & Governance

Industry Regulations

Subject to US import duty proclamations and SEBI Regulation 31A regarding promoter reclassification.

Taxation Policy Impact

Current tax liabilities stood at INR 7.5 Cr as of the latest reporting period.

Legal Contingencies

The company faces a 'ROR liability' (Right of Recompense), the resolution of which is a key sensitivity factor for its credit rating.

⚠️ Risk Analysis

Key Uncertainties

The primary uncertainty is the timeline for regaining the US export market, with a potential impact on revenue if the December 2025 recovery is delayed.