Bharat Forge Q4FY22 profit up on new orders, FY23 seen stronger

Bharat Forge clocked a 9.3 percent increase in its Q4FY22 consolidated net profit at Rs 231.86 crore Vs Rs 212.12 cr in Q4FY21. Revenue from operations during Q4 came in at Rs 3,573.09 crore Vs Rs 2,082.85 cr in Q4 of last fiscal driven by pickup in both domestic & export markets.

The company’s total expenses in the fourth quarter were higher at Rs 3,295.61 crore Vs Rs 1,840.63 crore in the same period a year ago. EBITDA margins at 25.7% in Q4FY22 were maintained as compared to Q4FY21, despite cost inflationary pressures.

In terms of the automotive segment’s growth, Bharat Forge maintained that despite challenges like supply chain related issues, increased cost of ownership due to regulatory challenges, high input cost inflation, all segments of the industry have shown double digit growth ranging from 20 percent for PVs to 50 percent for MHCVs. The company’s revenue growth from the CV segment has been inline with the underlying market growth.

Bharat Forge Chairman & Managing Director, Baba Kalyani said “In FY22, the Indian operations has secured new orders worth Rs 1,000 crores across automotive and industrial application. This includes a healthy mix of existing and new customers across traditional and new products. In the international operations, new orders worth $150 million have been secured across steel & aluminium forging operations in North America.”

Kalyani elaborated that these orders wins in the US are from marquee OEMs and provides a lot of growth visibility in the medium- to long-term. Adding details about how the EV business is shaping up, he added that, “The EV vertical has secured orders from a global EV OEM for supply of aluminium castings and its maiden order from an Indian OEM for supply of DC-DC converters.

At a consolidated level, Bharat Forge management expects FY23 to be a strong year characterised “by topline growth coupled with strong cashflows, ramp up of the US Aluminium operations, revenue contribution from the newer verticals and a further diversified revenue mix. For the standalone business, we expect continued growth in the key markets across all sectors. Easing of cost pressures & supply chain tightness will provide a fillip to the end demand across geographies,” added Kalyani.