Balu Forge Joins NATO Supply Chain, Launches Automated Artillery Plant

A New Chapter in Indian Defence Manufacturing

Balu Forge Industries Ltd, a Mumbai-based precision engineering firm, has achieved two significant milestones that position it as a key player in the global and domestic defence sectors. The company has been formally inducted into the NATO supply chain as a certified supplier and has simultaneously commissioned India’s first fully indigenous automated production line for large-calibre artillery shells at its facility in Belgaum, Karnataka. These developments underscore a major validation of India's 'Make in India' and 'Atmanirbhar Bharat' initiatives, signaling growing international confidence in the country's manufacturing prowess.

Induction into the NATO Supply Chain

The formal entry into the NATO supply chain allows Balu Forge to manufacture and supply critical defence components, including high-specification artillery shell bodies and complex forged parts, directly to NATO member states. This accreditation is not merely a supply contract but a testament to the company's advanced technological capabilities. The selection highlights Balu Forge's expertise in closed-die forging, sophisticated multi-axis CNC machining (utilizing 7 and 11-axis machines), and advanced material science, including specialized heat treatment and alloy optimization. These processes are essential for producing components that meet the stringent precision and reliability standards required for modern battlefield conditions.

Trimaan Chandock, Executive Director of Balu Forge, described the induction as a validation of the company's vision of 'Make in India for the world.' It reflects the depth of technical capability within the firm and boosts India's stature in the global defence manufacturing landscape. This strategic partnership is expected to significantly expand Balu Forge's global footprint and diversify its revenue streams with high-margin defence products.

State-of-the-Art Artillery Shell Production

Complementing its NATO certification, Balu Forge inaugurated a cutting-edge, fully automated production line for empty artillery shells at its greenfield campus in Belgaum. This facility is a landmark achievement for India's defence self-reliance, designed and executed entirely in-house with collaboration from over 18 Indian machinery manufacturers. The production line leverages FANUC robotics to achieve nearly 100% automation, enabling an unmanned production process with a cycle time of just 55 seconds per shell.

This advanced facility is engineered to produce a range of large-calibre ammunition shells, including 155mm, 120mm, 105mm, and 81mm projectiles. With an annual production capacity of 360,000 shells, the plant is set to address the growing domestic demand and reduce India's reliance on imports from countries like Russia and South Korea. This indigenous capability ensures a more reliable and sustained ammunition supply for the Indian armed forces.

Strategic Impact and Market Outlook

The dual developments position Balu Forge at the forefront of India's industrial revitalization. The company's fully integrated model, which covers forging, precision machining, heat treatment, and metallurgical validation, provides a significant competitive advantage. The recent Free Trade Agreement (FTA) with the European Union is also expected to strengthen its position within the European defence supply chain.

From a financial perspective, these strategic moves are poised to drive long-term growth. In the second quarter of FY26, Balu Forge reported a 34.4% year-on-year increase in revenue from operations, reaching ₹2,995 million, with profit after tax rising by 35.5% to ₹650 million. While the company is in a capital-expenditure-heavy phase, the monetisation of its defence vertical is expected to contribute materially to earnings from the second half of FY26 onwards.

Risks and Investor Considerations

While the outlook is optimistic, potential risks remain. The complex geopolitical landscape can influence defence procurement decisions, and adherence to NATO's stringent quality and delivery standards will be critical. Furthermore, execution risks associated with scaling up production to meet international demand will require careful management. Investors will be closely watching the company's ability to secure a steady pipeline of orders from NATO countries, manage the production ramp-up efficiently, and maintain margin resilience.

Conclusion: A Strategic Leap Forward

Balu Forge Industries has laid a robust foundation to become a champion in India's defence supply chain. By securing a place in the NATO supply network and establishing a highly advanced, indigenous production facility, the company has demonstrated both technical excellence and strategic foresight. The challenge now lies in execution, converting these capabilities into sustained contracts and profitable growth. If successful, Balu Forge is well-positioned to become a significant contributor to India's ambition of becoming a global defence manufacturing hub.