Neutral Bharat Forge; target of Rs 1470: Motilal Oswal

Motilal Oswal recommended Neutral rating on Bharat Forge with a target price of Rs 1470 in its research report dated September 23, 2024.

Broker Research

September 24, 2024 / 11:59 IST

Neutral

26 Aug, 2025 12:21

Volume

Todays L/H

Motilal Oswal's research report on Bharat Forge

We met BHFC’s management team recently to understand the company’s growth outlook in the coming years. Key growth drivers for BHFC would be: 1) the robust order backlog of INR54b in defense exports to be executable over the next three years, along with the prospects of the beginning of domestic defense orders soon; 2) with new order wins and multiple initiatives, JS Autocast (JSA) is likely to emerge as one of the fastest growing businesses of BHFC; 3) the aerospace segment is set to clock strong growth in the coming years; 4) PV exports are likely to moderate in FY25E, but they should pick up from FY26 onward given a healthy order backlog. However, CVs (both domestic and exports) and domestic PVs are likely to see weak growth. Given the weakness in Europe, the turnaround in overseas subsidiaries may happen with a lag of a couple of quarters.

Outlook

We estimate a CAGR of 13%/26%/54% in consolidated revenue/EBITDA/PAT over FY24-26. However, at 45.5x/34x FY25E/FY26E PER, we believe the current valuation fully prices in the positive factors. We remain Neutral with a revised TP of INR1,470 (based on 30x Sep’26E consolidated EPS).

For all recommendations report, click here