The shares of the leading forging company gained up to 1 percent after the company’s subsidiary announced a collaboration with AMD (Advanced Micro Devices) to enter the Indian server market.
Price Action
With a market capitalization of Rs 49,919.62 crore, the shares of Bharat Forge Ltd were trading at Rs 1,044.15 per share, increasing around 0.27 percent as compared to the previous closing price of Rs 1,041.05 apiece.
Reason for Fall
According to the company filing, Kalyani Powertrain, a wholly-owned subsidiary of Bharat Forge Ltd. has collaborated with AMD (Advanced Micro Devices) to enter the Indian server market. This collaboration marks a major milestone in advancing India’s server infrastructure by integrating cutting-edge AMD technology into domestically manufactured solutions.
Moreover, Kalyani Powertrain and AMD’s partnership will introduce advanced EPYC™-based server technologies in India, enhancing data infrastructure. This move supports high-performance computing across automotive, telecom, cloud, and AI sectors, strengthening India’s server capabilities and positioning it as a key global tech player.
Furthermore, this collaboration strengthens India’s Make in India initiative by enhancing local manufacturing and reducing import reliance. It provides enterprises, cloud providers, and government organizations with high-performance, cost-efficient server solutions for AI, cloud computing, and data processing, advancing India’s digital infrastructure and positioning it as a global AI and cloud leader.
Financial Analysis
Recently, the company announced its financial performance in which revenue decreased by 10 percent on a year-on-year basis from Rs 3,866 crore in Q3FY24 to Rs 3,476 crore in Q3FY25. However, on a Quarter-on-Quarter basis, revenue shrunk by 6 percent from Rs 3,689 crore in Q2FY25 to Rs 3,476 crore in Q3FY25.
Moreover, net profit tumbled by 16 percent on a yearly basis from Rs 254 crore in Q3FY24 to Rs 213 crore in Q3FY25, meanwhile, on a quarter-on-quarter basis, net profit down by 12 percent from Rs 243 crore in Q2FY25 to Rs 213 crore in Q3FY25.
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Order Wins and Business Segments
The company secured Rs. 646 crore in new orders in H1, with total orders at Rs. 2,200 crore, mainly in defense (Rs.1,400 crore). JSA showed strong performance with Rs. 173 crore in order wins. Defense revenue surged 67 percent YoY to Rs.509 crore, with a Rs. 5,900 crore order book.
Market Outlook
The management remains optimistic post-election, expecting higher government spending to boost India’s CV and passenger car markets. The U.S. market is strong with continued growth prospects. Diversified revenue across defense, industrial, aerospace, and casting sectors should help shield the company from regional downturns.
Strategic Initiatives
Management is pursuing strategic M&A to enhance capabilities and expand the “Make in India” initiative. Additionally, rising interest from U.S. customers post-elections signals growth opportunities in exports and partnerships, strengthening the company’s global presence and reinforcing its long-term expansion strategy.
Management insight
Management attributed the weak performance to sluggish economic conditions in the EU, affecting European operations and exports. Additionally, the inherent volatility in the defence sector impacted quarterly results, contributing to the company’s subdued performance during the period.
Moreover, the management remains optimistic about the defence sector’s growth, projecting revenue to reach Rs. 2,200 crore in FY26. They acknowledge its volatility but expect annual double-digit growth, emphasizing the sector’s strong long-term opportunities and sustained momentum in the coming years.
Company profile
Bharat Forge Limited is an India-based global provider of safety and critical components and solutions to various sectors including automotive, railways, defence, construction and mining, aerospace, marine, and oil and gas. The Company’s segments include Forgings and Others.
Written by Abhishek Singh
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