Bharat Forge will go all out to double its revenues from the domestic market to a whopping INR 7,000 crore. This will help it be completely debt free by the year 2018 according to sources.
India’s biggest forging company with a huge pie in the passenger and commercial vehicles segments, Bharat Forge is all out to scale up domestic revenues to INR 7,000 crore by the year 2018 with 29-31% of standalone margins. This will be double of the present revenue and better asset turnover will help it be debt free by the FY18. The company remains optimistic about long term potential of revenue but it also acknowledges how pressure remains on it across multiple segments.
The company has also stated that the second half of the current fiscal may witness corrections in inventory in a few segments owing to the pressure talked of above. According to experts, this will be a tough achievement ahead for the company. Analysts forecast INR 6,400-6,600 crore of revenue for the company by FY18. The stock has already shed value over the last six months with fluctuations in both non-automobile and automobile segments.
The company management is expecting the US truck market to remain in limbo till 2017 but the impact of the same should be low owing to increased market share of the company as per forecasts. Sales of commercial vehicles should be moderate but this should be compensated due to the rising market share of the company when it comes to passenger cars.