Bharat Forge Q1 profit drops 38 per cent to Rs 122 crore

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Mumbai: On Friday Bharat Forge Ltd has also conveyed that, its net profit for the June quarter depreciates 38% from a year previously due to inferior total revenues. Net profit drops to Rs.122.06 crore in comparison to Rs.195.97 crore a year before. The corporation was expected to post a net profit of Rs.156.40 crore. Total revenues for the quarter decrease 19.31% to Rs.957.03 crore next to Rs.1,186.06 crore a year ago.

The domestic revenues climbs 10.8%, but it was negated by the 40% de-expansion in exports that was affected mainly by a decreasing US heavy truck market and commodity related sectors in the industrial segment. B.N. Kalyani, chairman and managing director of the company has also further conveyed that, we have had a very demanding quarter mainly because of continuing weak demand and inventory destocking in the commodities space, particularly in the oil & gas space.

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This coupled with the severe downturn in the North America truck market has resulted in a weak performance in June quarter. Earnings before interest, taxes, depreciation and amortization (Ebitda) drop 31.3% to Rs.253.70 crore in comparison to Rs.369.20 crore a year before. Ebitda margins decrease 460 basis points to 26.5% from 31.1% previous year in the similar quarter.

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Kalyani has also further conveyed that, for the September quarter, we expect demand to be somewhat superior in comparison to the June quarter, with positive demand in India crossways automotive and industrial while the challenging demand environment in the export industrial sector will carry on for some more time as global economics adjusts to inferior commodity prices. At 10.40am, Bharat Forge was buying and selling at Rs.754.90 on the BSE, up 4.3% from its preceding close, while India’s benchmark Sensex Index increase 1.07% to 28,010.31 points.