Latest news with #BaluForge
Mint
22-05-2025
- Business
- Mint
Ashish Kacholia portfolio: Nuvama sees 30% upside in Balu Forge shares. Should you buy?
Shares of Ashish Kacholia portfolio stock Balu Forge Industries have caught the attention of market watchers after brokerage firm Nuvama Institutional Equities initiated coverage with a 'Buy' rating and a price target of ₹ 790, indicating a 30 percent upside from current levels. The optimistic outlook is driven by the company's aggressive capacity expansion, strategic entry into defence manufacturing, and efforts to diversify away from the agriculture sector. Balu Forge's stock, which is part of ace investor Ashish Kacholia's portfolio, has already delivered over 100 percent returns in the last one year. However, after correcting 20 percent in 2025 and 25 percent from its October 2024 peak, Nuvama believes the recent dip presents an attractive entry point. 'As the new capacity comes up, Balu Forge will start selling bigger and heavier machined components. This should drive re-rating of the stock especially as the sales and EBITDA grow by 30% CAGR,' the brokerage noted in its latest report. In a bullish scenario, Nuvama estimates the stock could even climb to ₹ 850, driven by long-term structural growth and improving margins. Ashish Kacholia held 18.65 lakh Balu Forge shares, representing 1.66 percent stake in the company. Strong Capacity Push and Defence Entry Key to Growth: Balu Forge, founded in 1989, has been a dominant player in crankshaft manufacturing for the agriculture industry. However, as per Nuvama, the company is undergoing a strategic transformation to enter high-value verticals such as defence, oil & gas, and industrial segments. The company has ramped up its machining capacity from 18,000 metric tonnes (mt) in FY24 to 32,000mt in FY25 and has plans to scale it further to 80,000mt over the next 12–18 months. A critical part of this expansion includes a defence production line with the capacity to produce 3.6 lakh artillery shells annually, expected to go live in the first half of FY25. This defence focus, according to Nuvama, is likely to mark a major inflection point for the company. Capitalising on Supply Chain Shifts: The Russia-Ukraine conflict disrupted the global supply chain of forging components, especially in Europe. Nuvama pointed out that this led to a vacuum in the market, prompting Indian companies like Balu Forge to ramp up production capacity. The company is now positioning itself as India's second-largest forging player after Bharat Forge. With its new manufacturing capabilities, Balu Forge can machine components up to three metres in length and weighing up to 1,500kg—surpassing most domestic peers. 'Only Bharat Forge comes close, with a machining limit of 1,250kg. This makes Balu Forge well-positioned to serve the growing needs of sectors like defence and railways,' the brokerage added. Diversifying Away from Agriculture: Nuvama also highlighted that Balu Forge is working to reduce its dependence on agriculture, which currently contributes 40 percent of its revenue. The company aims to cut this to 25 percent by FY28 while boosting its exposure to railways, aerospace, and defence to 25 percent—up from the current 10 percent. This strategic shift into high-margin, capital-intensive segments is expected to reduce revenue volatility and strengthen long-term growth. Solid Earnings Outlook Through FY28: According to Nuvama, Balu Forge is expected to witness a 30 percent CAGR in production volumes between FY25–27, thanks to the new capacity coming online. At the same time, average realisations are projected to rise to ₹ 400–450/kg from the current ₹ 250–260/kg. These factors combined are expected to drive revenue and EBITDA CAGR of 34 and 35 percent, respectively, over FY25–28. Net profit is also estimated to grow at a healthy 30 percent CAGR, despite marginal compression in PAT margins due to increased depreciation and lower other income. Balu Forge has delivered multibagger returns of 106 percent in the last one year. In May 2025 alone, the stock has surged 25 percent after a 20 percent decline in April. It jumped 35 percent in March, recovering from back-to-back declines of 22 percent in February and 23 percent in January. With strong fundamentals and sectoral tailwinds, the stock appears well-positioned to sustain its upward trajectory in the coming quarters. Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
Business Standard
15-05-2025
- Business
- Business Standard
Balu Forge Q4 PAT jumps 123%; EBITDA margin expands sharply
Balu Forge Industries reported consolidated net profit surged 123.1% to Rs 62.69 crore on a 67.31% increase in revenue from operations to Rs 269.65 crore in Q4 FY25 over Q4 FY24. Profit before tax stood at Rs 74.06 crore, up 115.1% from Rs 34.43 crore in Q4 FY24. EBITDA for the quarter rose sharply to Rs 75 crore, reflecting a YoY growth of 118.1%, while EBITDA margin improved by 647 basis points to 27.8%. For the full financial year, the company posted a 65% rise in revenue to Rs 924 crore, up from Rs 560 crore in FY24. Net profit for FY25 came in at Rs 204 crore, up 118% from Rs 93 crore in the previous year. FY25 EBITDA jumped 110.8% to Rs 251 crore. Operating cash flow for FY25 rose 566% to Rs 148 crore, driven by robust EBITDA growth and improved receivables management. The company ended the year with a net cash position of Rs 60 crore. Total debt stood at Rs 36 crore, with cash and equivalents at Rs 96 crore. Balu Forge continued its focus on capital efficiency, with the debt-to-equity ratio improving significantly to 0.03x from 0.09x a year ago. Working capital days reduced to 104 from 129, reflecting better inventory and receivables control. ROCE rose to 30.1%, aided by higher asset utilization and a strategic shift towards high-margin product segments. The company increased its forging capacity to 100,000 TPA, with further expansion underway. Growth was supported by robust demand from defense, aerospace, and railwayssectors the company is increasingly targeting. Trimaan Chandock, executive director of BFIL, stated, Our revenue from operations for FY25 reached Rs. 924 crore, marking the highest revenue in the companys history. This reflects the strong growth of 65.0% compared to revenues of Rs 560 crore in FY24. In Q4FY25, we delivered revenues of Rs 270 crore, driven by steady demand in our core business, along with significant contributions from emerging sectors such as defense, aerospace, and railways. For the full year, our EBITDA grew by 110.8% to Rs 251 crore, leading to a significant improvement in margins, and profit after tax accelerated to Rs 204 crore, further reflecting our operational efficiency and strong execution. This performance underscores our ability to scale operations, leverage manufacturing capabilities, and diversify successfully across industries. In FY25, we made significant CAPEX investments in expanding our manufacturing capabilities and upgrading our technology to better serve critical sectors such as defense, aerospace, and railways. These strategic initiatives are set to be fully commissioned in the first half of FY26 and are poised to deliver significant results in the coming years, positioning us to capitalize on emerging growth opportunities. Looking ahead, we remain optimistic about the growth prospects for FY26. Our order book is growing, diversified, and high quality, with the company well-positioned to capture further opportunities in high-value, high-margin sectors. Our focus on innovation, technological upgrades, and expanding our talented team of engineering professionals will continue to be the driving force behind our long-term growth. We are confident that our ongoing investments in technology and capacity will further strengthen BFLL's position as a leading player in the precision machining industry. Meanwhile, the board has recommended a dividend of Rs 0.15 per equity share of face value Rs 10 each for FY25. Balu Forge Industries is engaged in the manufacturing of fully finished and semi-finished forged crankshafts and forged components. It has the capability to manufacture components conforming to the New Emission Regulations & the New Energy Vehicles. Shares of Balu Forge Industries rose 0.37% to Rs 620.65 on the BSE.
Economic Times
15-05-2025
- Business
- Economic Times
Stocks in news: Patanjali Foods, ITC Hotels, Tata Power, SBI, HUL, Balu Forge
Live Events (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel Markets traded within a narrow range on Wednesday following the preceding day's dip but managed to close slightly higher. In today's trade, shares of Patanjali Foods HUL , Balu Forge among others will be in focus due to various news developments and fourth quarter of JSW Energy, PB Fintech, Patanjali Foods, Cochin Shipyard and ITC Hotels will be in focus as the companies will announce their fourth quarter Power is looking to spend Rs 25,000 crore as capital expenditure (capex) in FY26 and the company is also keen to bid for two discoms in Uttar Pradesh, CEO Praveer Sinha 24|7, an omni-channel digital health platform, announced its foray into insurance with 'Apollo 24|7 Insurance Services' on Enfield has posted its highest-ever quarterly sales, clocking 2,80,801 units in Q4 FY25, a 23.2% growth over the same period last year, parent company Eicher Motors announced. Balu Forge Industries reported a 123% year-on-year jump in its Q4FY25 net profit at Rs 63 crore versus Rs 28 crore in the year ago firm Brigade Enterprises reported a 20% year-on-year (YoY) surge in net profit at ₹246.8 crore for the fourth quarter that ended March 31, Medicare said Unit-1 Of arm Shilpa Pharma Lifesciences has received Establishment Inspection Report (EIR) From US FDA. The site is classified as Voluntary Action Indicated (VAI). State Bank of India will consider fund raising of up to $3 billion via public offer or other currency in FY26 on May filed an insolvency application against Gensol Engineering for default of Rs 510 crore Hindustan Unilever received an observation letter with 'no adverse observations' from exchanges (NSE & BSE) on scheme of arrangement with Kwality Wall's India.
