Bharat Forge Reports Stellar Q3 with Net Profit Up 220% YoY

12 Feb 2024 , 02:33 AM

Leading forging company Bharat Forge Ltd., situated in Pune, reported a year-over-year increase in consolidated net profit for the December quarter of 2023 of over 220 % as a result of increased revenues.

The quarter’s combined net profit was ₹254.45 Crore, up 223% from ₹78.71 Crore in the previous year. Revenue increased by 15.7% to ₹3922.96 Crore from ₹3389.95 Crore in the previous year.

Revenues from the Defence business increased greatly, but those from the Oil & Gas and Agri industries decreased as compared to the previous year.

At 2.15 pm, the stock was trading on the BSE at ₹1277.6, down 2.8% from the previous close, while the benchmark Sensex in India dropped 0.6% to 71168 points.

An interim dividend of ₹2.5 per share was announced by the company. Additionally, it approved the raising of ₹500 Crore by debentures, term loans, or any other type of debt instrument. Additionally, the board decided to re-appoint Dipak Mane as the Non-Executive Independent Director for an additional five years.

EBITDA increased by 30.9% to ₹645 Crores, with EBITDA margins rising to 28.5%—a 330 bps gain—due to a focus on cost optimisation and a favourable product mix. The balance sheet is still strong, with a cash reserve of one thousand Crore rupees.

Exports from Indian manufacturing companies operating in the industrial, defence, and component sectors were $200 million in Q3 FY24, a 36% increase from Q3 FY23.

The company expects this number to continue rising as new verticals open up and its position in the industrial sector solidifies. The company closed new business deals of ₹550 Crores in a variety of industries throughout the quarter.

Operational gains were made in the European aluminium industry while operating abroad, and comparable results are anticipated for the US plant.

The company stated that it is committed to achieving long-term profitability in its international operations by leveraging advancements in the steel and aluminium industries, which should show results in the next 12 to 18 months. With its diverse business mix, the company hopes to beat the market even though it anticipates modest growth in both the local and export sectors in Q4 and FY25.

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