Balu Forge Industries Ltd. (BFIL) reported robust financial results for Q2 FY25, achieving a 107% year-on-year increase in consolidated net profit, which soared to Rs 48 crore from Rs 23 crore in the same quarter last year. The company’s revenue reached Rs 223 crore, driven by an expansion in operations and a rise in demand for heavier items that typically offer higher margins. This resulted in an impressive 116.5% increase in EBITDA and a significant enhancement in margins, rising by 763 basis points from 21.6% in Q2 FY24 to 29.3% in Q2 FY25.
Trimaan Chandock, Executive Director of BFIL, noted that the Indian precision engineering industry is entering a significant growth phase, propelled by global companies adopting the China+1 strategy to mitigate supply chain risks. To leverage this momentum, BFIL is investing heavily in strengthening its capabilities, positioning itself for robust, long-term growth.
The company’s new manufacturing campus in Belgaum is progressing well, with the first phase of commercialization anticipated soon. BFIL boasts a strong order book and plans to fully utilize its 32,000 tons of machining capacity. The introduction of advanced equipment, including a 7 Axis CNC machine, has been pivotal in enhancing operational efficiency.
Chandock highlighted that BFIL has successfully reduced its working capital cycle from 137 days in H1 FY24 to 106 days in H1 FY25, significantly improving liquidity and operational performance. This reduction in debtor days from 177 to 119 has also positively impacted cash flow, enabling reinvestment and reducing reliance on external financing.
Looking ahead, BFIL plans to expand its workforce to over 1,000 employees, focusing on research and development to drive innovation in new products and materials. This aligns with India’s infrastructure initiatives under the Viksit Bharat 2047 vision.
Overall, BFIL’s strategic focus on cost reduction, enhanced production timelines, and a more agile supply chain has created a solid foundation for sustained growth and competitiveness in the precision engineering sector.
Disclaimer: The information provided in this report is for informational purposes only and should not be construed as financial advice. While we strive to present accurate and timely information, we make no guarantees regarding the completeness, reliability, or accuracy of the data. Investors are encouraged to conduct their own research and consult with financial advisors before making investment decisions. The financial results and projections discussed are subject to change and may be affected by various factors, including market conditions and company performance.
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