Bharat Forge Comes Out With Surging Q4 Numbers

Bharat Forge reported strong financial performance for the quarter ended March 2014. With a good performance on the exports front, as well as on the domestic front the company posted a topline of Rs 930.50 crore and bottomline of Rs 119.50 crore against Rs 674.60 crore and Rs 50.10 crore posted in March 2013 quarter. Apart from that the company also has managed to put in a good performance on sequential basis. For December 2013, the company has posted a topline of Rs 832.10 crore and bottomline of Rs 92.70 crore. 

If we look at the revenues in terms of domestic and exports, it was the exports revenues which actually helped the company put in a strong financial performance. For the quarter ended March 2014, the company exported to the tune of Rs 507.90 crore as against Rs 479.70 crore in December 2013 and Rs 311.20 crore in March 2013. The EBITDA margins for the March 2014 quarter stood at 24.80% as against 22.60% attained in the March quarter previous fiscal.

There are few factors to be pointed out here, PBT before Exchange gain and exceptional item increased 21.0% in Q4FY14 to Rs 171 crore, compared to Rs 141.3 crore in Q3FY14. Exceptional item in Q4FY14 refers to the following items, profit of Rs 43.2 crore on sale of land, impairment charge taken on investments in Indian subsidiaries of Rs 30.8 crore which is non cash in nature. 

On consolidated basis the topline for FY14 stood at Rs 6716.10 crore as against Rs 5166.50 crore in FY13. The EBITDA for FY14 stood at Rs 1042.30 crore as against Rs 801.10 crore in FY13. Margins remained stagnant on the yearly basis. PAT for FY14 stood at Rs 498.50 crore, almost double than that of Rs 247.60 crore posted in FY13.

As on debt levels, the debt levels for FY14 declined to Rs 2561.20 crore from the levels of Rs 2784.50 crore in FY13. This helped the company bring the Debt/Equity ratio to 0.95 from the levels of 1.23.The performance has been quite good with the exports markets witnessing traction.

Here B.N. Kalyani, Chairman & Managing Director stated that, “BFL’s performance in FY14 has been encouraging with robust operating leverage and cash flows despite sub optimal utilisation levels in India caused by significant weakness in the commercial vehicle segment. The uncertain demand environment which prevailed during FY14 is beginning to change positively especially in the external markets and we expect both North America & Europe to grow in FY15. The domestic market might witness demand recovery in 2HFY15.”

About the future performance the management commented that, “We are witnessing strong momentum going into FY15 with topline growth expected to outpace the underlying market growth in all geographies driven by market share gains and new programs coming on stream.  Looking ahead into Q1FY15, we anticipate demand to be slightly higher compared to Q1FY14 and Q4FY14”.