Bharat Forge announced its Unaudited Financial Results for Q3 FY26, showing sequential improvement driven by the domestic automotive sector and defence execution. Standalone Revenues grew 7.0% QoQ to Rs 20,837 million, with EBITDA at Rs 5,694 million (27.3% margin). The defence order book remains robust at Rs 11,130 crores, bolstered by a major CQB Carbine contract. Management anticipates that the worst is behind them, projecting high double-digit growth in FY27.
Management Commentary: Q3 FY26 Performance
The quarterly performance was primarily affected by de-stocking in the North American CV market. However, Standalone Revenues saw a 7.0% sequential increase to Rs 2,084 crores, with EBITDA growing 4.6% QoQ to Rs 569 Crore, achieving an EBITDA margin of 27.3%. This performance was supported by strong growth in the Domestic automotive business and robust execution of the defence orderbook.
The company secured new orders worth Rs 2,388 Crores in Q3, with Rs 1,878 crores attributed to Defence. As of December 31, 2025, the defence order book stood at Rs 11,130 crores. A significant milestone was signing the CQB Carbine contract with the Ministry of Defence for over 250,000 units.
Subsidiaries showed positive trends: JS Autocast recorded revenue of Rs 203 Crore and EBITDA of Rs 32 Crore (15.7% margin), marking 22% and 39% YoY jumps respectively. K-Drive Mobility improved its profitability sharply, with EBITDA margins moving from 3.1% in Q2 FY26 to 5.1%.
Looking ahead, management is optimistic: “With both domestic and exports markets looking strong across sectors… we expect high double digit top line growth and commensurate impact on profitability” for Q4 FY26 and FY27.
Standalone Financial Highlights (Q3 FY26)
Standalone Revenues from Operations reached Rs 20,837 million, a 7.0% QoQ improvement, primarily due to higher Domestic Auto revenues and Defence execution.
- EBITDA: Stood at Rs 5,694 million, up 4.6% QoQ.
- EBITDA Margin: Reported at 27.3%, down 70bps QoQ due to product mix changes and increased tariff costs.
- PBT before Ex. Gain/ (Loss): Increased 2.7% QoQ to Rs 4,433 million.
Export Business Review (Q3 FY26)
Total Export Revenue was Rs 9,097 million, marking a 3% sequential decline. The major impact came from North America:
- Commercial Vehicles (CV) Exports: Declines were steep due to lower production and de-stocking; NA truck revenues declined by 51% YoY (vis-à-vis Q3 FY25). Early indicators suggest the worst may be over.
- Passenger Cars: Performed well in a seasonally weak quarter.
- Geography Breakdown (Rs million): Americas accounted for 5,355, Europe for 2,988, and Asia Pacific for 754.
Domestic Business Review (Q3 FY26)
Domestic Revenue reached Rs 10,719 million, driven by strong segment performance:
- Commercial Vehicles (CV): Performance was boosted by higher production volumes as GST rate cut benefits flowed through to lower Total Cost of Ownership (TCO).
- Passenger Car: Demand was higher due to GST benefits, with expectations for long-term growth based on expanding per capita car ownership.
- Industrial: Showed strong results from Defence execution and traction in Heavy Horse-power engines.
Consolidated Financial Highlights (Q3 FY26 vs FY25)
Consolidated Revenue reached Rs 43,428 million (QoQ growth driven by Defence). Consolidated EBITDA was Rs 7,502 million.
- Return on Capital Employed (RoCE Net): Improved slightly to 15.5% (from 15.4% in FY25).
- Net Debt/ EBITDA: Stood at 1.39x (up from 1.16x in FY25).
- Debt Position: Long term Debt decreased to Rs 13,616 million from Rs 19,839 million in FY25.
Consolidated Financial Reconciliation
The consolidation impact of K-Drive Mobility (fully owned subsidiary w.e.f July 1, 2025) is noted. In Q3 FY26:
- Indian Operations Revenue: Rs 30,452 million, contributing 23.3% EBITDA margin.
- Overseas Operations Revenue: Rs 12,912 million, with a low EBITDA margin of 3.8%.
Overseas Manufacturing Performance (Q3 FY26)
Total Overseas Manufacturing Revenue was Rs 12,912 million.
- European Mfg Operations: EBITDA margin was 4.3% (up from 1.1% in Q3 FY25), with PBT before Exchange Gain/(Loss) remaining negative at -Rs 539 million.
- US Mfg Operations: EBITDA margin was 2.7%, with PBT before Exchange Gain/(Loss) at -Rs 379 million.
Indian Subsidiary Performance (Q3 FY26)
Key performance indicators for select subsidiaries:
- KSSL: Achieved an EBITDA margin of 11.6% (up from 5.7% in Q3 FY25).
- BFISL: Maintained strong profitability with an EBITDA margin of 14.9%.
Source: BSE
