Bharat Forge Q3 Results: Profit Falls, Misses Estimates

Bharat Forge Ltd.'s Q3 revenue rose 40% to Rs 3,353.4 crore, against an estimate of Rs 3,091.5 crore.

<div class="paragraphs"><p>Bharat Forge signage is displayed at the entrance of its headquarter. (Source: Company website)</p></div>
Bharat Forge signage is displayed at the entrance of its headquarter. (Source: Company website)

Bharat Forge Ltd.'s net profit fell sharply in the third quarter as profitability reduced due to higher costs.

The company's consolidated net profit fell 96% to Rs 78.7 crore in the quarter ended December, according to its exchange filing. That compares with the Rs 222 crore consensus estimate of analysts tracked by Bloomberg.

The company's standalone profit fell 14% to Rs 289 crore, while revenue rose 22% to Rs 1,952 crore. The profit includes a foreign exchange gain of Rs 42 crore.

Bharat Forge Q3 FY23 Highlights (YoY):

  • Revenue rose 40% to Rs 3,353.4 crore, against estimates of Rs 3,091.5 crore.

  • Ebitda fell 6% to Rs 469.3 crore, compared with the forecast of Rs 511.6 crore.

  • Ebitda margin stood at 14%, as against 21% last year and an estimate of 16.5%.

The sharp contraction in margin was due to higher raw material, finance, and employee costs. Total expenses rose 52% year-on-year, compared to a 40% rise in revenue from operations.

The overseas operations posted an Ebitda loss of Rs 62 crore, due to ramp-up-related issues with the new aluminium forging capacities in Germany and the U.S., the company said in an update.

"They continue their journey towards profitability with a focus on improving capacity utilization, cost optimization, price increases, and cost compensation from customers," it said.

Shares of Bharat Forge were trading 3% lower as on 1:56 p.m., against a 0.9% rise in the benchmark Nifty 50.