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| CMP = 548 |
Kalyani Forge Ltd is Kalyani group company and incorporated in 1978. It specialised in niche precision forgings, fully-machined and sub-assembled products for domestic and global customers. Kalyani Forge is a leader in manufacturing close-tolerance, precision forgings at its five plants located in the automotive hub of Pune, Maharashtra.
Corporate video
https://youtu.be/7o4TkHt3Cyk
Kalyani Forge is an ISO TS 16949, ISO 14000 & OHSAS – 18001 certified engineering company with an expertise in metal forming built over deep experience of five decades. Kalyani Forge is trusted supplier of forged, machined and assembled products for a variety of customers in industries like automotive, construction, power generation, marine, railway, and general industrial goods. Its forging capabilities include hot, warm and cold forging & in-house heat treatment as well as machining. The company also provides services like product and process design, development, warehousing, door-to-door delivery, and validation support to its customers.
Kalyani Forge is a reliable partner to automotive OEMs and full system suppliers, it offers expertise for products in engines, chassis, transmission, driveline, steering and suspension units in two wheelers, passenger cars and commercial vehicles.
Kalyani Forge has expertise in manufacturing engine components for highway, off-highway and stationary engine applications. The company provide a wide range of products like connecting rod, crank shaft, cam shaft, retainer valve, cross head valve, injector clamp, rocker arm, balance weight, cam lobe, automatic and manual transmission parts, tulips, inner race, tripod, spider, outer race, yoke shafts and many more. Kalyani Forge is the first to introduce fracture split connecting rod in the Indian automotive market, which is known for its superior strength, toughness and economy.
Kalyani Forge is a worldwide provider of forged and machined components for construction & mining equipments , electrical generators and power generation systems used for standby power, distributed power generation and auxiliary power in mobile applications to meet the needs of a diversified customer base.
The company provide ready-to-assemble components for all types of medium-speed and high-speed commercial marine engines.
Kalyani Forge design, develop and manufacture the critical parts for transmission and braking systems for all types of rail vehicles.
In the agricultural sector, the company is leading component manufacturers for the global agricultural and industrial engine market.
The company provide various cold and hot forged parts for industrial applications like power tools, conveyors, compressors and many more.
Kalyani Forge is trusted supplier to many of the global leaders in automotive and industrial segments - Daimler, MAN, JCB, TATA, Mahindra, Musashi, Honda, Honeywell, Cummins, Turbocam, Kirloskar etc.
Investment Rationale
Kalyani Forge as an engineering company with extensive experience, it delivers the solutions - quickly, economically and efficiently - right from drawing through to full-scale production.
Kalyani Forge provides “first-time-right” products with Near Net Shape (NNS) technology, Lean Product Development approach, progressive and innovative engineering team, which is ready for challenges in new product development, aiming at highest quality, lowest cost and shortest development lead-time.
Kalyani Forge can produce complex, critical profile forgings of high accuracy due to greater quality control with in-house die designing processes. This enables the company to manufacture dyes and tooling to high levels of accuracy.
The thermal refining of the products is achieved with in house continuous heat treatment lines, equipped with facilities for oil/polymer/water quenching and tempering. For thermal treatment of ‘Near Net Shape’ products is achieved with controlled atmosphere furnaces. A state of the art phosphating and bonderising facility, takes care of special processes that need to be executed before cold forging operations.
In-house machining facility equipped with high end CNCs, VMCs and SPMs dedicated machining lines. The company has started developing the components for electromotive vehicles such as hybrid electric vehicles, plug-in hybrid electric vehicles and fuel cell electric vehicles to make its presence in high growth & high margin segment i.e. driveline components (xEV), axle components (xEV).
The company is strategically located in the manufacturing hub of Pune, it is ideal for raw material source as well as for export through the Mumbai sea port.
Capex for Forging and Machining Capacity Expansion
Kalyani Forge has already made several high return investments on capacity management and modernisation program to enhance the profitability and efficiency.
All machining units shifted to one site and re-layouts done for 6 old lines based on lean manufacturing principles, 50% of existing shop floor space freed up for new expansion.
The company has commissioned several capex projects till Q3 FY25. Machining expansion phase 1 complete, phase 2 underway, new forging press installed, rooftop solar project commissioned etc.
Capex - Digital Shop Floor
Digitisation projects underway in collaboration with Group technology partner Kalyani Studio for enabling automation and predictive maintenance of machines, data driven insights analysis and quality data traceability and rapid problem solving.
Business Development
Kalyani Forge enjoys entrenched position with multi-decade relationship with OEMs. The company is participating in the development programs of EVs with leading car OEMs in India. Kalyani Forge with focused strategy on core products and segments, its new business development is on track with multi-year order book of 384 Cr won in H1 FY25 and new MNC customers acquired in xEV product group.
Promoters
Kalyani Forge promoters have around five decades of long experience in the domestic forging and machining industry. Their strong understanding of market dynamics and healthy relationship with reputed original equipment manufacturers will continue to support the business for future growth. In FY 2024 new generation promoter Mr. Viraj Kalyani appointed as managing director to take the company to next level.
For further details you can also refer below given Q2 and Q3 transcript of the Analyst/Investor conference call . It contains good information about past and future prospectus of the company.
https://www.kalyaniforge.com/wp-content/uploads/2024/11/Video-Recording-for-November-13-2024-1.mp4
https://www.kalyaniforge.com/wp-content/uploads/2024/11/Transcript-of-call-held-on-November-13-2024.pdf
https://drive.google.com/file/d/1VLmxlB3iLkghssjetNdutM5Te3PF1_Gs/view?usp=sharing
https://kalyaniforge.com/wp-content/uploads/2025/02/Transcript-of-the-call-held-on-February-13-2025-1-3.pdf
Conclusion
Kalyani Forge is 50 year old company with good asset and consolidating its revenue and profitability for last two decades. Now company is looking to move forward with expansion and modernisation with aim to double its production capacity and sales. Kalyani Forge is micro-cap company with lot of growth potential.
The stock has also seen good correction since last three months. Kalyani Forge stock at cmp Rs 548 is giving excellent investment opportunity for both short term and long term. It can be bought within 20% from cmp with 10 % allocation.
