Bharat Forge net profit declines by 26%; export market to remain sluggish
BN Kalyani, Chairman & Managing Director of Bharat Forge said, We are starting to witness demand in global markets slowly turn positive once again. This has allowed BFL to offset sudden decline in domestic CV market and improve profitability on a sequential basis.
Pune-based Bharat Forge reported net profit of Rs 126.89 crore for the second quarter ended September 30, 2016, witnessing a decline of 26.34% year-on-year (yoy) but growth of 3.95% quarter-on-quarter.
BN Kalyani, Chairman & Managing Director of Bharat Forge said, “We are starting to witness demand in global markets slowly turn positive once again. This has allowed BFL to offset sudden decline in domestic CV market and improve profitability on a sequential basis.”
Total income from operations stood at Rs 935.91 crore, decreasing by 20.07% yoy and 2.20% qoq.
Operating profit (EBITDA) was at Rs 2531 crore, down by 24.33% yoy and 0.23% qoq. It’s operating profit margin stood at 27%, contracting by 160 basis points yoy but expanding by 50 basis points qoq.
On segment wise revenue break-up, the shipment tonnage segment was at Rs 46,203 crore declining by 15.3% yoy. and 5.9% qoq.
For Q3 outlook, Kalyani said, “We anticipate improved demand condition in India across automotive and industrial segment. We expect export market to remain sluggish, although we some green shoots in oil and gas and allied segments. The business has clearly bottomed out and we look forward to the growth journey ahead of us.”
Bharat Forge has proposed divestment of 49% stake in power equipment JV with Alstom for $35 million.
Shares of Bharat Forge fell by Rs 8.25 or 0.96% on BSE, trading at Rs 850 per share at 1.42 pm.
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