Bharat Forge dips 8% on 27% YoY decline in PBT, weaker H2FY20 expectation

Shares of Bharat Forge slipped 8 per cent to Rs 433 on the BSE on Friday after the company's consolidated profit before tax (PBT) declined 27 per cent year on year (YoY) to Rs 251 crore in the September quarter (Q2FY20) due to de-growth in revenue.

While total consolidated revenue was down 16.9 per cent YoY to Rs 2,158 crore, EBITDA (earnings before interest, tax, depreciation and amortisation) margin contracted 690bps at 14.7 per cent from 21.6 per cent in the year ago quarter.

Calling the quarter gone by as "the toughest in this decade", the management said weak end-demand across sectors due to  the sluggish macroeconomic environment in India, and the need of the automotive original equipment manufacturers' (OEMs) to destock ahead of introduction of Bharat Stage (BS) VI emission standards led to the continuous decline in the demand through the quarter.

Given the prevailing environment in India and the slowdown in North America & Europe, the management expects H2FY20 to be lower than H1 FY20.

At 01:40 pm, Bharat Forge was trading 7 per cent lower at Rs 437, as compared to a 0.33 per cent decline in the S&P BSE Sensex. The trading volumes on the counter jumped more than three-fold with a combined 4.6 million shares changing hands on the NSE and BSE so far.

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