Balu Forge Industries Ltd. Announces Q1FY25 Financial Results, PAT rises 104.96% to ₹341.67 Mn

·         Revenue increases 55.99% YoY to ₹1,753.09 Mn

·         Recommended final dividend of 1.5% per share of Rs.10/- each for FY24

Balu Forge Industries Ltd. (BFIL), a leading precision engineering and manufacturing company, approved its Audited Consolidated Financial Results for the quarter ended 30^st June 2024, in the meeting of its Board of Directors held on 30^th July 2024.

                                    *Amount in Mn

Consolidated Financial Highlights for the Q1 FY25:

1. BFIL registered a robust revenue growth of 55.99% and revenue from operations stood at ₹1,753.09 Mn in Q1FY25 compared to ₹1,123.85 Mn in Q1FY24 because of the constant focus on client addition and continued demand for the specialized engineering products.

2. EBITDA grew by 97.31% and margins expanded by 516 bps from 19.48% in Q1FY24 to 24.64% in Q1FY25 owing to increase in scale of operations and increased demand for heavier products which tend to yield better margins.

3. The board of directors has recommended a final dividend of 1.50% of the face value per equity share of Rs.10/- each for the financial year 2023-24.

4. PAT margins improved by 466 bps from 14.83% in Q1FY24 to 19.49% in Q1FY25.

Commenting on the performance of Q1FY25, Mr. Trimaan Chandock, Executive Director of BFIL stated:

“We are happy to share our financial and business performance for Q1FY25, we registered robust revenue growth of 55.99% with revenue from operations standing at ₹1,753.09 Mn in Q1FY25 compared to ₹1,123.85 Mn in Q1FY24 owing to our constant focus on client addition and continued demand for our specialized engineering products. EBITDA grew by 97.31% and margins expanded by 516 bps from 19.48% in Q1FY24 to 24.64% in Q1FY25 owing to increase in scale of operations and increased demand for heavier products which tend to yield better margins. PAT grew by 104.96% and PAT margins improved by 466 bps from 14.83% in Q1FY24 to 19.49% in Q1FY25. The board of directors have recommended a final dividend of 1.50% of the face value per equity share of Rs.10/- each for the financial year 2023-24.

Our robust financial performance was an outcome of our dedicated strategy implementation focused on addition of new products into our portfolio by understanding our customer needs, diversification of customer base and offering cutting edge solutions across industries like power generation, construction, hydraulics, and wind energy. Further, the Indian forging industry is undergoing rapid transition and transformation, with superior implementation of the China+1 strategy to de-risk supply chains.

This diversification and macro change in the industry landscape offers us a plethora of opportunities and provides a long runway for growth. In order to appropriately capitalize on the opportunity, we are investing heavily in our capabilities which are poised to yield positive results in the near future.

Apart from the financial achievement, the current quarter was marked with various remarkable business accomplishments which are focused on expanding our capability, integrating our operations and becoming a more prominent force in the critical forging and precision machining landscape:

1. Acquisition of three state of the art forging production lines, with a capacity of producing 72,000 tons of forged products. This comprehensive setup includes 16-ton closed die forging hammer, 10-ton closed die forging hammer and 8,000T capacity mechanical press. This acquisition not only strengthens & expands our critical engineering product portfolio but also enhances the R&D capability enabling a product portfolio expansion in newer industries. It provides us a niche strength in creating products from different alloys from Aluminium to Titanium. This is a part of our strategic vision to increasingly contribute in manufacturing highly complex products at a global scale. The new forging unit will be seamlessly integrated with our current capabilities to deliver end to end solutions under one roof with best in class, Industry 4.0, practises to ensure high level of manufacturing efficiency.  

2. The proposed fundraise of INR 496.80 crores will strengthen manufacturing capacity, enhance the capability and play an incremental role in making India atmanirbhar/ self-reliant in defence, railways and aerospace sector. This will further aid turning the vision of Viksit Bharat as formulated by our Honourable Prime Minister into reality. With this, we aim to procure Solid Wheel Rolling Machinery which will produce the one of the largest railway wheels of up to 1,300 mm dia & further strengthen the company’s ability to cater to field of Defence, Aerospace & Railways.

In conclusion, BFIL is committed to expanding its capabilities through strategic investments in assets and the augmentation of our team to deliver top-quality, innovation-driven products. This approach positions us as a leading player in the market. Our dedication to sustainability and continuous improvement allows us to meet current customer demands while anticipating and shaping future industry needs. As we progress, we remain focused on driving substantial revenue and profit growth, enhancing stakeholder value, and making a positive contribution to the global economy.”