Bharat Forge hits 11-month low on disappointing Q2 results

The stock dipped 6% to Rs 815, its lowest level since November 2014 on the NSE.

Bharat Forge has dipped 6% to Rs 815, its lowest level since November 2014 on the NSE, after the company reported a lower-than-expected net profit and revenues for the quarter ended September 30, 2015 (Q2FY16).

The net profit at Rs 175 crore for Q2FY16 was flat when compared to a profit of Rs 174 crore in the same quarter year ago.

Total revenues during the quarter under review declined 1.9% to Rs 1,169 crore, as compared to previous year quarter mainly due to decline in revenues from the industrial segment on account of the downturn in commodity prices.

The operating or earnings before interest, tax, depreciation and amortization (EBITDA) margin stood at 30.1%, improved by 100 basis points on year on year basis, however it contracted by 170 basis points on sequential basis.

Analysts, on an average, had expected profit of Rs 193 crore on revenues of Rs 1,278 crore for the quarter.

Entering into H2 FY16 (October-March), we anticipate demand trend to be similar to H1 FY16 (April-September), B N Kalyani, chairman and managing director of Bharat Forge said.

Global macro uncertainty and its adverse impact on demand in the industrial sector will be compensated to some extent by positive automotive demand and ramp up of passenger vehicle business, he added.

At 02:28 pm, the stock was down 6% at Rs 816 on the NSE. A combined 3.84 million shares changed hands on the counter on the NSE and BSE.