Forgings and defence equipment major Bharat Forge Ltd. drew mixed views from brokerages, with Jefferies turning more constructive while Kotak Securities stayed cautious on valuation. The company reported their consolidated results for the Q4FY26 on Thursday with net profit declining even as revenue and operating earnings rose on a year-on-year basis.
Jefferies On Bharat Forge
Jefferies maintained its positive stance and raised its target price to Rs 2,500 from Rs 2,150, implying an upside of about 25.2% from the current market price of Rs 1,997. The brokerage has maintained a "buy" call on the stock saying the company is "inflecting upwards" and noted a brighter operational outlook.
It sees a sharp rebound in US truck orders, expansion in defence and aerospace, and an improving revenue outlook for key industrial export customers. Jefferies upgraded its FY27-28 EPS estimates by 4-10% and expects consolidated EPS growth to accelerate from a 9% CAGR over FY24-26 to 42% CAGR over FY26-28.
Kotak Securities On Bharat Forge
Kotak Securities, however, maintained its 'sell' rating and lifted its target price to Rs 1,300 from Rs 1,250, implying a downside of about 34.9%. It said weak execution and expensive valuations offer little comfort, even as it expects revenue growth to accelerate, supported by better domestic auto demand, a bottoming out in US and EU CV segments, and strong growth in casting, aerospace and defence.
Citi On Bharat Forge
Citi has maintained its sell rating on Bharat Forge, while raising the target price to Rs 1,060. The brokerage said Bharat Forge's Q4 results were slightly ahead of estimates, helped by healthy export performance across sub-segments. However, domestic revenue came in a little below Citi's expectations. The management's outlook remains positive, with aerospace and defence expected to be the key growth drivers for the company going forward.
Despite this, Citi has retained its sell call, citing the fact that defence orders have seen delays in the past. The brokerage said it would wait for revenue recognition in the second half before turning more constructive on the stock. The brokerage has also increased its target multiple to 31 times from 29 times.
Bharat Forge Q4FY26 (Cons, YoY) At Glance
Bharat Forge posted a net profit of Rs 233 crore for the quarter, down 17.5% from Rs 282 crore in the corresponding period last year. However, revenue from operations increased 17.5% to Rs 4,528 crore, compared with Rs 3,853 crore a year earlier.
- Net Profit down 17.5% at Rs 233 crore versus Rs 282 crore
- Revenue up 17.5% at Rs 4,528 crore versus Rs 3,853 crore
- EBITDA up 14.1% at Rs 778 crore versus Rs 681 crore
- EBITDA Margin at 17.2% versus 17.7%
ALSO READ: Bharat Forge Q4 Results: Net Profit Down 17.5%, Final Dividend Declared — Check Record Date
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