Bharat Forge - Q1FY21 Result Update - ICICI Securities

Bharat Forge (BFL) reported a weak Q1FY21 performance. Standalone revenues fell 68.3% YoY to Rs. 427 crore tracking 70.7% YoY tonnage drop to 17,840 MT. Total India revenues were at Rs. 167.8 crore (down 71.7% YoY; CV down 84.7%, PV down 85.8%, industrial down 51.2%). On the international side, PV revenues de-grew 52.6% while CV revenues fell 78.9%, industrial revenues fell 50.7%. Among geographies, Americas posted 74% revenue fall while the drop was more contained in Europe (down 41%). Standalone EBITDA was at negative Rs. 3 crore, with margin performance likely impacted by inventory adjustment. Reported standalone loss at PAT level was at Rs. 56.3 crore, supported by higher other income. At the consolidated level, the company reported Rs. 1.9 crore as share in loss at subsidiaries/associates, down sharply from loss of Rs. 21.4 crore in the previous quarter.

Valuation & Outlook

For BFL, we expect 1%, 13.2%, 35% CAGR for consolidated sales, EBITDA, PAT, respectively, in FY20P-22E. Progress on business de-risking from CV, continued margin delivery and improvement in profitability of European subsidiaries remain key monitorables going ahead. We maintain HOLD rating on BFL, valuing it at 30x FY22E EPS of Rs. 13.7 for target price of Rs. 415.

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_BharatForge_Q1FY21.pdf

Shares of BHARAT FORGE LTD. was last trading in BSE at Rs.494.8 as compared to the previous close of Rs. 502.8. The total number of shares traded during the day was 476640 in over 11182 trades.

The stock hit an intraday high of Rs. 511.4 and intraday low of 485.45. The net turnover during the day was Rs. 237400676.

Source : Equity Bulls

Keywords