Forge Auto International (NSE:FORGEAUTO) Interest Coverage : 3.43 (As of Mar. 2024)

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What is Forge Auto International Interest Coverage?

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. Forge Auto International's Operating Income for the six months ended in Mar. 2024 was ₹124 Mil. Forge Auto International's Interest Expense for the six months ended in Mar. 2024 was ₹-36 Mil. Forge Auto International's interest coverage for the quarter that ended in Mar. 2024 was 3.43. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Forge Auto International's Interest Coverage or its related term are showing as below:

NSE:FORGEAUTO' s Interest Coverage Range Over the Past 10 Years
Min: 3.01 Med: 3.43 Max: 3.44
Current: 3.43

NSE:FORGEAUTO's Interest Coverage is ranked worse than
67.56% of 1042 companies
in the Vehicles & Parts industry
Industry Median: 8.055 vs NSE:FORGEAUTO: 3.43

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Forge Auto International Interest Coverage Historical Data

The historical data trend for Forge Auto International's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

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Forge Auto International Interest Coverage Chart

Forge Auto International Annual Data

Trend

Mar22

Mar23

Mar24

Interest Coverage

3.44

3.01

3.43

Forge Auto International Semi-Annual Data
	Mar22	Mar23	Mar24
Interest Coverage	3.44	3.01	3.43

Competitive Comparison of Forge Auto International's Interest Coverage

For the Auto Parts subindustry, Forge Auto International's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Forge Auto International's Interest Coverage Distribution in the Vehicles & Parts Industry

For the Vehicles & Parts industry and Consumer Cyclical sector, Forge Auto International's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Forge Auto International's Interest Coverage falls into.

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Forge Auto International Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage

-1

Operating Income

Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt ⁽¹⁾.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Forge Auto International's Interest Coverage for the fiscal year that ended in Mar. 2024 is calculated as

Here, for the fiscal year that ended in Mar. 2024, Forge Auto International's Interest Expense was ₹-36 Mil. Its Operating Income was ₹124 Mil. And its Long-Term Debt & Capital Lease Obligation was ₹180 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Mar. 2024 )	/	Interest Expense (A: Mar. 2024 )
	=	-1	*	124.172	/	-36.254
	=	3.43

Forge Auto International's Interest Coverage for the quarter that ended in Mar. 2024 is calculated as

Here, for the six months ended in Mar. 2024, Forge Auto International's Interest Expense was ₹-36 Mil. Its Operating Income was ₹124 Mil. And its Long-Term Debt & Capital Lease Obligation was ₹180 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Mar. 2024 )	/	Interest Expense (Q: Mar. 2024 )
	=	-1	*	124.172	/	-36.254
	=	3.43

The higher the ratio, the stronger the company's Financial Strength is.

Forge Auto International (NSE:FORGEAUTO) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .

Forge Auto International Interest Coverage Related Terms

Thank you for viewing the detailed overview of Forge Auto International's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.

Forge Auto International Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Vehicles & Parts » Forge Auto International Ltd (NSE:FORGEAUTO) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

N/A

Address

Machhiwara Road, Village Mangarh, Kohara, Ludhiana, PB, IND, 141001

Website

https://www.failtd.com

Forge Auto International Ltd is an engineering company engaged in forging and manufacturing of complex and safety-critical, forged and precision machined components such as big rings, small rings, big ball studs, gear blank with a broach, stub axle assembly, flange yoke 325 HS, catering to different industry sectors like auto industry including automobiles, tractors, railways etc. and non-auto sectors like agriculture parts, hydraulic parts, striking tools etc. It serves its customers comprising of domestic and global original equipment manufacturers (OEMs) engaged in manufacturing for both the automotive sector and other nonautomotive sector, used across industries by a diversified base of customers.

Forge Auto International Headlines

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