Bharat Forge Q2 profit rises 12% to Rs 227 cr on strong domestic, exports growth

Auto ancillary company Bharat Forge has reported a 11.6 percent on year growth in second quarter profit to Rs 227 crore, driven by strong topline growth. However, margin contraction and forex loss limited profitability.

Profit in corresponding period last fiscal stood at Rs 204 crore.

Revenue from operations during the quarter surged 33.5 percent to Rs 1,679 crore YoY, with healthy 31.5 percent growth in domestic business and 34 percent in exports.

"The company has reported broadbased growth across all business segments and geographies during the quarter. Revenue growth was driven by doubling of passenger vehicle export revenues, accompanied with healthy double digit growth in other key verticals," Baba Kalyani, CMD said.

On outlook, he said, "The sustained high demand from customers across commercial vehicle, passenger vehicle, traditional industrial and defence & aerospace, makes us confident of the strong growth prospects for the second half of FY19."

Shipment tonnage during the quarter increased by 18.8 percent compared to year-ago.

Bharat Forge has reported a whopping 39 percent on year growth in Americas business to Rs 661.7 crore in Q2FY19 while Europe business grew by 32 percent to Rs 253.7 crore and Rest of World revenue surged 46 percent to Rs 28 crore.

"North American Class 8 orders continue to exceed expectations with most of months in CY2018 hitting all-time highs," the company said, adding demand in the European truck market continued to be good as a result of high freight activity and customer profitability, wherein the market demand is expected to remain healthy going forward as well.

At operating level, EBITDA (earnings before interest, tax, depreciation and amortisation) grew by 17.6 percent year-on-year to Rs 434.4 crore, but margin fell 350 bps to 25.9 percent for the quarter ended September 2018.

Forex loss for the quarter stood at Rs 41 crore against loss of Rs 12 crore in same period last year.