Bharat Forge Q2 FY27 Results Analysis: PAT Falls 8%, Margin Compresses 232 bps (BHARATFORG)

Cofacto Research Published November 05, 2026 4 min read

Neutral

Bharat Forge Ltd's Q2 FY27 numbers came in mixed, with revenue of Rs. 4,869.97 Cr (+20.79% YoY) and PAT growth of -6.90% YoY. Here's a quick read of what worked, what to watch, and what management said.

Quick Details

Results date	November 05, 2026
Revenue (Q2)	Rs. 4,869.97 Cr (+20.79% YoY)
PAT (Q2)	Rs. 278.68 Cr (-6.90% YoY)
EBITDA margin	15.64% (-232 bps YoY)
EPS (Q2)	Rs. 5.77 (-7.83% YoY)

Quarter Snapshot

Consolidated revenue grew 20.79% YoY with standalone up 29.77%, but consolidated PAT fell 7.80% as input-cost inflation compressed EBITDA margin 232 bps YoY to 15.64%. The Rs.2,000 Cr QIP cut net debt to Rs.4,531.78 Cr and margins showed a first sequential uptick, but defence margins (2.90% EBIT vs 22–23% guided EBITDA) and a Rs.94.96 Cr subsidiary drag are key H2 swing factors against the ~25% India growth guidance.

Q2 FY27 Expectations vs Results

Driver	Expected before results	What happened	Verdict
Revenue "likely ahead" on SIAM/FADA/Class-8 tailwinds	demand recovery flows into dispatches	Consolidated revenue +20.79% YoY; standalone +29.77% YoY	Played out
Margin rebound toward ~28% standalone depends on customer recoveries landing	recoveries affect both revenue and cost	Standalone margin 25.83%, +88 bps QoQ — partial	Partially
QIP mechanically improves Sep-30 cash/leverage	Rs.2,000 Cr raise inside the window	Cash Rs.2,679.08 vs Rs.847.89; net debt Rs.4,531.78 vs Rs.5,884.68	Played out
Watch BF CDP provisions beyond the Rs.330.42 Cr Q1 social-plan charge	any escalation	Q2 exceptional only Rs.24.57 Cr incidental; no new provision — favorable	No escalation
Watch US operations EBITDA swing ("verification quarter")	press breakdowns fixed	US block not disclosed in this filing — open for the call	Not observable
Watch tariff drag quantification	fresh Sep 18 overhang	Not quantified in the filing	Not observable

Read our full results preview.

Management Guidance vs Delivery

What management said	Where	What happened	Verdict
India business growth ~25% FY27 (20–25%, H2-weighted)	Q4 FY26 / Q1 FY27 earnings calls	H1 standalone revenue +20.3% YoY; hitting ~25% for FY27 now requires H2 of ~Rs.5,620.8 Cr, i.e. +29.4% YoY vs FY26 H2 — H2-dependent	On Track
Defence EBITDA margin 22–23% FY27	Q4 FY26 earnings call	Q2 defence segment EBIT margin 2.90% (Q1: 7.61%); segment EBITDA not disclosed	Too Early
Defence revenue "better than this year"	Q4 FY26 earnings call	H1 defence revenue +47.0% YoY	On Track
India organic capex ~Rs.1,800 Cr FY27	Q1 FY27 earnings call	H1 consolidated capex Rs.982.49 Cr	On Track
BF CDP restructuring completion by end-CY2027; EUR ~30 Mn impact	Q1 FY27 earnings call	Only Rs.24.57 Cr incidental expenses in Q2; no new provision	On Track
Fundraise up to Rs.2,500 Cr	Q1 FY27 earnings call	Rs.2,000 Cr QIP completed Sep 17–22, 2026	On Track

Key Investment Insights

Key Positives

Consolidated revenue grew 20.79% YoY to Rs.4,869.97 Cr; standalone revenue grew 29.77% YoY
Standalone PAT grew 19.65% YoY to Rs.370.82 Cr with EPS of Rs.7.74 vs Rs.6.48
Standalone EBITDA margin improved 88 bps QoQ to 25.83%, the first sequential uptick after successive declines
Defence revenue grew 47.0% YoY in H1 to Rs.968.41 Cr; Board approved up to Rs.290.51 Cr additional investment in KSSL
Rs.2,000 Cr QIP completed; net debt reduced to Rs.4,531.78 Cr from Rs.5,884.68 Cr; consolidated D/E improved to 0.64x from 0.72x
No new BF CDP social-plan provision in Q2; exceptional limited to Rs.24.57 Cr of incidental expenses
Others segment revenue grew 27.9% YoY with margin expanding to 7.20% from 6.33%

Risk Factors

Consolidated PAT-to-owners fell 7.80% YoY despite 20.79% revenue growth; normalized consolidated PAT still −1.4% YoY
Forgings segment margin fell 249 bps YoY to 12.77% with segment result down 2.8% YoY on input-cost squeeze
Defence segment EBIT margin fell to 2.90% (Q1: 7.61%), far below management's 22–23% FY27 EBITDA-margin guidance, with no explanation in the filing
Subsidiaries dragged consolidated PAT Rs.94.96 Cr below standalone PAT; cumulative NCI is negative Rs.19.96 Cr
Working-capital build: inventories +Rs.639.83 Cr since March; consolidated CFO only 0.25x H1 EBITDA; H1 FCF negative at Rs.(616.22) Cr
Reaching ~25% FY27 India growth guidance requires H2 growth of ~29.4% YoY vs 20.3% in H1