Bharat Forge gears up by 4 per cent; effect of NA Class 8 truck orders

Shares of forging major, Bharat Forge surged as much as 4 per cent in early trades owing to FTR (Freight Transportation Research) release which stated that order inflow of North America Class 8 trucks has increased by 34.6 per cent to 14,000 compared to 10,400 units sold in the month gone by.

With this order, total count for Class 8 trucks has reached 206,000 units. Falling sales of trucks in North America has put pressure on the earnings of Bharat Forge, India's largest forging company in the past few quarters, with almost 20 per cent of its FY16 revenue coming from the North American truck market, which constitutes a very important geography for the company. According to the company, worst seems to be over for the company in the North American markets.

Currently Bharat Forge still derives 45 per cent of its revenue from Commercial Vehicles and 10 per cent from Oil & Gas. Company has been constantly trying to diversify its revenue base by entering into different segments. 

Reacting to the good truck sales numbers, Bharat Forge's scrip has shot up by more than 4 per cent to hit an intra-day high of Rs 907.85 on NSE in early morning trade.