Bharat Forge kicks off fiscal 2027 with robust revenue growth and a surge in defence orders, signalling a shift towards higher-margin markets despite facing operational headwinds and margins fluctuations.
Bharat Forge reported a solid start to fiscal 2027, with standalone revenue rising 11.5% year on year to ₹2,347 crore and EBITDA margin holding at 26.2% despite higher costs, according to its earnings commentary. The company said the quarter was weighed down by energy, input and logistics inflation, but it expects some margin recovery in the second quarter as price increases feed through and US operations normalise.
A key theme in the update was defence, where the order book climbed to ₹11,196 crore and received a boost from a marine systems breakthrough involving gas turbine engines for Kolkata-class ships. The company also said new orders were secured across forging, defence and ferrous casting, while Indian subsidiaries such as Kalyani Strategic Systems and JS Auto Cast posted revenue and EBITDA growth of more than 30%.
Management struck an upbeat tone on growth platforms beyond core forgings. According to the company’s call, the aerospace business, which is currently about ₹400 crore, could double in two to three years, helped by a new ring mill at Baramati. Executives also pointed to opportunities in semiconductors, power generation and data-centre-linked energy systems, and said the group plans to raise as much as ₹2,500 crore for growth capital expenditure in higher-margin businesses.
There were, however, clear operational headwinds. The US business reported an EBITDA loss after equipment problems at a steel plant, while the company is also dealing with restructuring at its German steel arm, Bharat Forge CDP, with a provision of about €30 million and completion targeted by the end of FY27. In defence, management said margins can swing quarter to quarter even though it sees 22% to 23% as a steady-state annual range, and it flagged a procedural delay in approvals for ATAGS deliveries. Bharat Forge said the approvals should come through in a few weeks, after which shipments to the armed forces can begin.
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