Bharat Forge Q2 Skyrockets Past Expectations: Exports Dip, But Defense & Domestic Boom Fuels 4% Stock Surge!

Bharat Forge Limited announced its September quarter financial results, showcasing significant growth. The company's consolidated net profit surged by 23% year-on-year to ₹299 crore, comfortably exceeding the CNBC-TV18 poll forecast of ₹236 crore. Revenue also saw a healthy increase of 9.3% from the previous year, reaching ₹4,032 crore, which was above the ₹3,748 crore estimated by analysts.

Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA) grew by 12.1% to ₹726 crore, surpassing the poll expectation of ₹612 crore. Furthermore, EBITDA margins expanded by 50 basis points (0.5%) to 18%, outperforming the projected 16.3%.

Despite warning of declining exports to North America in the latter half of the fiscal year due to challenging demand, Bharat Forge expressed confidence that its industrial business within India, increased exports to other global geographies, and a significant ramp-up in its defense segment will more than offset this slowdown. The company also revealed it secured new orders worth ₹1,582 crore, with ₹559 crore coming from the defense sector, bringing its total defense order book to ₹9,467 crore. All defense assets have been transferred to its subsidiary, KSSL.

**Impact**: This news is significant for Indian investors as it demonstrates the financial health and strategic diversification of a key manufacturing player. The company's ability to navigate export challenges and leverage domestic and defense growth signals resilience, which is positive for the broader industrial sector and the Indian stock market. The stock's positive reaction to the results and commentary underscores investor confidence. Rating: 7/10.

**Definitions**: EBITDA: Stands for Earnings Before Interest, Tax, Depreciation, and Amortization. It is a measure used to evaluate a company's operating performance by excluding non-operating expenses and non-cash charges. Basis points: A basis point (bp) is a unit of measure used in finance to describe the percentage change in a financial instrument. One basis point is equal to 0.01% (1/100th of a percent). So, 50 basis points equals 0.5%.