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Informist, Monday, Jul 22, 2024

By Darshan Nakhwa

MUMBAI – Bharat Forge Ltd is expected to report strong growth in key earnings metrics for the June quarter, led by industrial and passenger vehicle parts businesses, exports, and softening of raw material prices, according to brokerage firms.

The Pune-based automotive and engineering major is expected to have earned a net profit of 3.98 bln rupees on net sales of 23.60 bln rupees in Apr-Jun, according to the average of estimates of six brokerage firms. The company's bottomline is likely to grow by 27.7% on year and by 2.1% sequentially. Its topline is seen up by nearly 11% on year and 1.3% on quarter.

Among the estimates, the highest projection for revenue during Apr-Jun is 23.88 bln rupees, while the lowest is 23.17 bln rupees. The highest and the lowest estimates for the bottomline are 4.09 bln rupees and 3.86 bln rupees, respectively. 

Brokerage firm Sharekhan in a pre-earnings note said the company's total revenue is likely to grow by 12.2% on year on the expectation of a 16% increase in domestic revenue and 9% increase in export revenue in Apr-Jun. Nuvama Wealth Management expects the company's topline growth to be driven by industrial and passenger vehicle business.

On the quarter-on-quarter growth in topline, YES Securities (India) in a note said that standalone revenue is likely to grow 2.1%, owing to shipment tonnage remaining flat at 66,700 tn, but realisation increasing 2% to 356,500 rupees/tn.

The company's earnings before interest, taxation, depreciation, and amortisation for Apr-Jun are seen at 6.65 bln rupees, according to the average of estimates from five brokerages. In the year-ago period, its EBITDA was 5.49 bln rupees, and it was 6.59 bln rupees in Jan-Mar.

On the profitability front, Bharat Forge's EBITDA margin is expected to expand to 28.4% from 25.8% in the year-ago period, and 28.3% in Jan-Mar, according to the average of estimates from four brokerages. Factors such as lower raw material prices, higher realisations, and improvement in exports are likely to expand the company's margin on year.

Bharat Forge has not yet announced the date for its Apr-Jun earnings. The company's stock has gained nearly 16% since its March quarter earnings. Today, the company's stock closed 2.9% higher at 1,625.45 rupees on the National Stock Exchange.

Following are the Apr-Jun earnings estimates for Bharat Forge, in mln rupees, from six brokerage firms: 

End

Edited by Deepshikha Bhardwaj

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