Synopsis:
Bharat Forge jumped sharply after reports emerged of a Rs 2,700 crore contract signed by the Indian Army for the purchase of 4.25 lakh carbines, out of which the company will be supplying 2.5 lakh, and the rest will be supplied by Adani’s defense arm, PLR Systems.
The shares of this leading manufacturer and seller of forged and machined Compounds for the automotive and industrial sectors are in focus after reports emerged of a potential order win by the company. In this article, we will dive more into the details.
With a market capitalization of Rs 62,247 crore, the shares of Bharat Forge Ltd made a day high of Rs 1304.90 per share, up by 5 percent from its previous day’s closing price of Rs 1243.60 per share. Over the past five years, the stock has delivered a robust return of 163 percent, outperforming NIFTY 50’s return of 119 percent.
About the Report
According to reports, the Indian Army has inked a massive deal worth Rs 2,700 crore to buy 4.25 lakh new Close Quarters Battle (CQB) carbines as part of the “Make in India” project. 2.5 Bharat Forge will provide 2.5 lakh carbines, and the remaining ones will be supplied by Adani’s PLR Systems.
The weapons are said to be equipped with DRDO technology and will replace the old vintage carbines, which were phased out a long time ago, but have remained in use for some time.
The new 5.56 mm carbines are intended to keep Indian soldiers “combat-ready” in close-quarter operations. The vendors are anticipated to start the deliveries next year, as per the reports. This will be a major step forward in the development of India’s domestic defence production industry.
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Financial Highlights
The company’s revenue for Q1 FY26 came in at Rs 3,909 crore, registering a 5 percent decline from Rs 4,106 crore in the same quarter last year. Coming to its profitability, the company reported a net profit growth of 62 percent to Rs 284 crore in Q1 FY26 as compared to Rs 175 crore in Q1 FY25.
The stock has delivered an ROE and ROCE of 11.58 percent and 12.18 percent respectively, and is currently trading at a high P/E of 60.69x as compared to its industry P/E of 31x.
Bharat Forge Limited is a leading global supplier of forged and machined components, operating across three major business segments: Forgings, Defense, and Others. It caters to a diverse set of industries, including automotive, oil and gas, railways, marine, aerospace, power generation, construction, and e-mobility. Its key product offerings include crankshafts, axle beams, turbochargers, transmission parts, propellers, and high-precision defense components.
Written by Satyajeet Mukherjee
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