Q2 2025 Bharat Forge Ltd Earnings Call Transcript
Key Points
- Bharat Forge Ltd (BOM:500493) reported a resilient standalone performance with a margin expansion of 140 basis points to 28.8%, driven by a favorable product mix.
- The company has a strong balance sheet with a gross debt to equity ratio of 0.46 times and cash on hand of almost INR2,000 crore, positioning it well for future opportunities.
- Bharat Forge Ltd (BOM:500493) won new orders worth INR2,200 crore in the first half of the fiscal year, with a significant portion from the defense sector.
- The defense segment showed impressive growth with a 67% year-over-year increase in revenue, and the order book stands at about INR5,900 crore.
- The aerospace business is expected to grow substantially, with new orders indicating a potential for exponential growth compared to the previous year.
- The European market remains challenging, impacting the company's overall performance, particularly in the commercial vehicle and passenger vehicle export business.
- The overseas operations faced a seasonally weak quarter, with European operations posting an EBITDA of INR75 crore and US operations reducing their EBITDA loss to INR45 crore.
- The EV vertical is taking longer to reach EBITDA break-even due to the current slowdown in Europe.
- Asia revenue saw a year-over-year decline due to a slowdown in certain countries and inventory corrections.
- The company is experiencing some pain in its European and Swedish operations, necessitating downsizing efforts to address these challenges.
Ladies and gentlemen, good day and welcome to Bharat Forge Limited Q2 FY25 earnings conference call.
(Operator Instructions)
Please note that this conference is being recorded.
I now hand the conference over to Mr. Amit Kalyani, Vice Chairman and Joint Managing Director, Bharat Forge Limited. Thank you and over to you, sir.
Good afternoon, ladies and gentlemen and thank you for your time in attending our call.
I will now hand over the explanation part of the call to my colleagues, Kedar and Raj Gopal and then I'll be happy to take your Q&A.
Good afternoon, ladies and gentlemen, and welcome to the conference call.
Talking about standalone business, Q2 standalone performance was resilient given the underlying demand conditions. While the top line was flat at INR2,247 crore, the margin expanded by 140 basis points to 28.8%, reflective
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