Bharat Forge (500493) Q1 25/26 earnings summary

Executive summary

• Q1 FY26 standalone revenue was INR 21,047 million, down 2.7% year-over-year, mainly due to global tariff uncertainties, emission norm pauses, and seasonality in the electric business.

• Standalone EBITDA for Q1 was INR 5,878 million with a margin of 27.9%, down 120 bps QoQ, impacted by lower utilization, tariff costs, and unfavorable product mix.

• Consolidated Q1 revenue reached INR 39,088 million, with EBITDA at INR 682 crore and a margin of 17.4%.

• Overseas operations, especially in the US and Europe, showed improved financial performance, with 70% utilization and positive EBITDA margins.

• New business wins totaled INR 900 crore across core, defense, and J&T segments, with the defense order book at INR 9,463 crore.

Financial highlights

• Absorbed INR 14 crore in tariff-related expenses during Q1.

• Standalone PBT before exchange gain/loss was INR 4,653 million, down 8% QoQ and 11% YoY.

• PAT for the quarter was INR 3,456 million, up from INR 2,694 million in Q1 FY25.

• U.S. aluminum business posted a second consecutive quarter of positive EBITDA margins at 6.1%.

• American Axle India CVF acquisition expected to add INR 1,000 crore to consolidated topline from Q2 FY26.

Outlook and guidance

• Cautious outlook for US export business due to recent US tariff announcements and emission regulation changes.

• FY26 expected to be challenging given the current cycle and geographical exposure; focus remains on cost optimization and capturing opportunities in less-affected markets.

• Aerospace segment projected to maintain 20%+ annual growth, with limited U.S. exposure.

• Positive momentum anticipated in the second half, with ongoing evaluation of European steel business restructuring.

• Defence vertical expected to secure new orders in FY26, providing revenue visibility for future years.