Bharat Forge share price corrected nearly 2 percent on May 5 after the fall in profitability for the quarter ended March FY23.
The forging company has recorded a 6.7 percent year-on-year decline in standalone profit at Rs 244.5 crore for the March FY23 quarter, impacted by lower other income, higher finance cost and exceptional loss.
The standalone revenue from operations for the quarter grew by 19.3 percent year-on-year to Rs 1,997.3 crore, the highest so far, with sales increasing across all business areas and regions, Bharat Forge said in its filing to exchanges.
The topline was driven by 11.2 percent growth in domestic business and 25.7 percent increase in export revenues in Q4FY23.
On the operating front, the company said EBITDA (earnings before interest, tax, depreciation and amortisation) grew by 21.4 percent on-year to Rs 522.8 crore with margin expansion of 50 bps at 26.2 percent for the quarter ended March FY23.
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For the full year, Bharat Forge recorded a 3 percent decline in profit at Rs 1,045.5 crore and revenue increased by 20.4 percent to Rs 7,572.7 crore compared to the previous financial year, with domestic and exports businesses showing 20.4 percent and 21.7 percent growth year-on-year respectively.
The year gone by was marked by record order wins of Rs 4,000 crore across defence, castings and the standalone business. These order wins provide strong visibility of
revenue growth for the coming 2-3 years, BN Kalyani, Chairman and Managing Director said.
The company registered a 14.7 percent growth in EBITDA for FY23 at Rs 1,928 crore, but the margin fell by 140 bps to 25.5 percent compared to the previous fiscal.
"FY23 was a tough year for the overseas subsidiaries which recorded an EBITDA loss of Rs 96 crore due to challenges in the new aluminium forging facilities, coupled with cost under-recoveries which continue to impact profitability," Kalyani said.
For FY24, Kalyani expects strong growth across revenues, profitability and return ratios, driven by the core forging business and amply supported by all other platform businesses such as defence, industrial segment and e-mobility.
"We believe that many of the troubles ailing the overseas aluminum business are behind us and expect them to contribute to improvement in return ratios for the consolidated entity," he said, adding that for the standalone business, FY24 looks to be good, driven by growth in the end markets globally and ramp-up of new orders won over the past few years.
The stock was trading at Rs 759.3 on the NSE, down 2 percent with a volume of 35.48 lakh shares, at 14:58 hours IST.
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