Bharat Forge Q1 Results: Stock falls 6% after ₹358 crore exceptional item drags co to net loss

Bharat Forge Ltd. reported results for the June quarter on August 10, that were below standalone, as well as consolidated expectations. The stock is down over 5.5% after the results.

On a consolidated basis, Bharat Forge reported a net loss of ₹90 crore, compared to a net profit ₹284 crore it had reported during the same quarter last year. The CNBC-TV18 poll had pegged the figure to be a profit of ₹349 crore.

Multiple one-offs, which resulted in a one-time exceptional loss of ₹358 crore, resulted in the company reporting a net loss during the quarter.

Revenue for the quarter stood at ₹4,640 crore, a growth of 18.7% from the year-ago period, and also higher than the CNBC-TV18 poll expectation of ₹4,591 crore.

Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) for the quarter stood at ₹709.4 crore from ₹670 crore last year and lower than the CNBC-TV18 poll figure of ₹783 crore.

EBITDA margin for the period stood at 15.29%, a contraction of 170 basis points from the same quarter last year. A CNBC-TV18 poll had pegged the figure to be 17%.

On a standalone basis, the company reported a net profit of ₹321.3 crore, which is a drop of 5% from last year's figure of ₹338.5 crore, and below the CNBC-TV18 poll projection of ₹369 crore.

Revenue for the quarter stood at ₹2,347.4 crore, which was in-line with the CNBC-TV18 projection of ₹2,323 crore, while being 11.5% higher than the same quarter last year.

Standalone EBITDA stood at ₹585.6 crore, lower than the projection of ₹624 crore and 2.4% higher than the year-ago period.

EBITDA margin for the quarter narrowed to 24.9% from 27.1% last year, and also turned out to be lower than the CNBC-TV18 poll figure of 26.8%.

The board has also approved a plan to raise up to ₹2,500 crore via equity and debt instruments.

For the India business, Bharat Forge has maintained its growth outlook of 20% to 25% for the full financial year, expecting the growth to be more pronounced for this fiscal.

The company also said that it is in the process of setting up dedicated forging and machining capabilities with an investment outlay of around ₹1,800 crore over the next 12-18 months, which will generate incremental revenue in the coming years after commissioning.

Bharat Forge's India operations won new orders worth ₹1,352 crore during the quarter, which included ₹681 crore from the defence business. With this, the outstanding order book of the Defence business is worth ₹11,196 crore.

Shares of Bharat Forge are now trading 6% lower on Monday after the results announcement at ₹2,139.3. The stock is still up over 45% so far this year.

This is breaking news and will be updated with more details.