The board has approved acquisition of 40% more stake in arm Analogic Controls India
Bharat Forge, the world’s biggest forging company, which reported its net profit in the three months to June quarter rise by 43 per cent to Rs 175 crore due to higher income on Thursday, also announced 1:1 bonus issue. The net profit was higher than the Rs 159 crore estimate of analysts tracked by Bloomberg.
The Pune-based auto components maker had clocked a net profit of Rs 122.06 crore during the same period of the previous fiscal, Bharat Forge said in a BSE filing.
In a separate filing, the company said it has secured a Rs 201.60 crore order from the defence ministry to supply 1,050 dual technology detection equipment. The order will be manufactured in India and is to be concluded in two years. Total income during the quarter rose 30.63 per cent to Rs 1,283.70 crore as against Rs 982.67 crore in the year ago period.
Bharat Forge also said its board has approved acquisition of the remaining 40 per cent stake in its subsidiary company called Analogic Controls India (ACIL), post which ACILBSE will become a wholly-owned subsidiary of Bharat Forge.
The board of the company has also recommended issue of bonus shares of the company in 1:1 ratio, subject to the approval of investors, the company said. “Q1 FY18 was a strong quarter for the company with robust export revenues on back of increasing demand across automotive and industrial sectors,” Baba Kalyani, chairman and managing director at Bharat Forge, said.
Despite disruption in domestic automotive demand caused by GST transition, revenues were flat compared to previous year on back of market share gain and new product ramp up, he added.
Exports in Q1 grew by 64.6 per cent to Rs 671.4 crore and domestic business saw a growth of 5 per cent at Rs 560.2 crore year-on-year basis. Operating profit grew by 36.4 per cent to Rs 333 crore and margin expanded by 70 basis points to 27.7 per cent compared with same quarter last year despite inflationary expenses.
Bharat Forge expects to see continued broad based industrial activity and growth. It also expects demand to be higher than the same period previous year. “Export demand is expected to remain robust across sectors while we see the domestic automotive sector recovering from the pain of GST transition,” Kalyani said.