Bharat Forge Bull Vs Bear Case: One analyst sees a 24% gain, another a 46% downside

Shares of Bharat Forge will be in focus on Friday, February 13, following its third-quarter results, which were steady, aided by strong growth in the domestic auto business and execution of its defence order book.

As many as 28 analysts track the stock, with 10 each maintaining a 'Buy' and 'Hold' rating, while eight have a 'Sell' recommendation.

On the bullish side, Jefferies upgraded Bharat Forge to 'Buy' from 'Underperform' and has a price target of ₹2,150, implying a potential upside of 24% from current levels.

The brokerage cited that Q3 EBITDA rose 18% YoY, about 4% above its estimates, driven by improved performance at subsidiaries.

Jefferies believes the operational outlook is improving, citing signs of a bottoming US truck cycle, better truck demand in India, easing India-US tariff concerns, and continued traction in defence.

It has upgraded FY27 and FY28 EPS estimates by 4-18% and expects earnings growth to accelerate from a 12% CAGR over FY24-26E to 33% CAGR over FY26-28E.

However, Citi remains cautious, maintaining a 'Sell' rating with a price target of ₹930, implying a potential downside of 46% from the last closing price.

The brokerage said Q3 earnings were below its estimates due to weaker export revenues.

Management pointed to a sharp 51% YoY decline in the North American truck segment due to destocking, though it described the outlook as buoyant.

The company remains optimistic about both exports and domestic segments. It expects 30-40% YoY growth in the defence business in FY27 and indicated 18-20% medium-term growth visibility.

Order inflows during the quarter stood at ₹23.9 billion, including a defence order worth ₹18.8 billion. The aerospace segment is also witnessing sustained traction.

Citi argues that valuations at 49x and 40x FY27 and FY28 consensus P/E adequately price in positives, leaving limited room for disappointment.

Management commentary

Chairman and Managing Director Baba Kalyani said that looking into Q4 and FY27, it is fair to say the worst is behind the company. He added that both domestic and export markets are looking strong across sectors.

Execution of the ATAGS order is expected to commence in H2 FY27. The company anticipates high double-digit topline growth with a commensurate impact on profitability.

Shares of Bharat Forge settled 3.33% higher on Thursday at ₹1,732.55. The stock has risen over 18% so far in 2026.