Speaking to CNBC-TV18, after the company’s March quarter earnings, Chairman and Managing Director Baba Kalyani said the company expects its defence business to grow by nearly 50% in FY27, while the automotive and industrial businesses are likely to expand by over 25%.
“The automotive segment, which also includes the industrial segment, we are likely to see growth of almost 25% plus. The defence business, we are likely to see growth of about 50%,” Kalyani said.
He attributed the strong outlook to robust demand trends across key global markets. According to Kalyani, Bharat Forge is witnessing strong momentum in the North American truck market, export passenger vehicle business and the fast-growing data centre ecosystem.
“There is strong growth in the data centre business, especially among people who supply standby power equipment to data centres. We are a big supplier to all those companies for components,” he said.
Kalyani added that the company expects exports of components linked to data centre infrastructure to reach nearly $100 million in FY27, compared to virtually zero two years ago.
The company is also increasingly using artificial intelligence and digital technologies to improve efficiency and accelerate product development, particularly in defence manufacturing.
Kalyani said Bharat Forge is targeting cost reductions of 5-7% through AI-led efficiencies by next year. However, he said the larger benefit was coming from faster product development cycles.
“What would take two to three years to make, with AI we are now able to make in less than one year,” he said.
He added that the company is using AI and digital technologies extensively in designing new defence products, significantly reducing time to market.
Apart from organic growth, Bharat Forge is also evaluating opportunities in high-technology manufacturing outside the automotive space, particularly in Europe. Kalyani said the company is exploring businesses that fit its engineering and technology ecosystem, although discussions are still at an early stage.
“Definitely not in the automotive space,” he said while referring to the company’s Europe plans.
On the defence side, Kalyani said Bharat Forge is focusing on building capabilities internally rather than pursuing acquisitions. He ruled out any immediate interest in companies such as Premier Explosives and said Bharat Forge is setting up its own explosives facility.
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“We have already got the land, we are ordering our equipment, and we are moving pretty fast in that area,” he said.
Bharat Forge reported a mixed set of March quarter earnings on Thursday. Net profit declined 17.4% year-on-year to ₹233 crore due to a one-time loss of ₹98.7 crore. Revenue rose 17.5% to ₹4,528 crore, while EBITDA increased 14.3% to ₹778 crore. EBITDA margin narrowed to 17.2% from 17.7% a year ago.
