Bharat Forge overseas losses widen as US EBITDA turns negative

Bharat Forge reported a Rs 149.4 crore overseas profit-before-tax loss after exceptional items in Q2 FY27, while revenue rose to Rs 1,407.1 crore and United States manufacturing earnings before interest, tax, depreciation and amortisation (EBITDA) turned negative at Rs 6.7 crore. The figures show sales growth did not translate into overseas profitability.

Why did Bharat Forge’s overseas loss increase in Q2 FY27?

Bharat Forge’s overseas profit before tax (PBT) loss after exceptional items increased to Rs 149.4 crore in Q2 FY27 from Rs 82 crore in Q2 FY26, even as overseas revenue increased by Rs 139.4 crore. Overseas EBITDA fell to Rs 22.3 crore from Rs 48.1 crore, reducing the EBITDA margin to 1.6% from 3.8%.

The reconciliation shows that the overseas PBT loss including other income widened to Rs 136.1 crore from Rs 81.5 crore. A Rs 9.2 crore exchange loss and Rs 4 crore of exceptional items then took the Q2 FY27 loss after exceptional items to Rs 149.4 crore; Q2 FY26 had a Rs 0.5 crore exchange loss and no exceptional items.

Bharat Forge’s consolidated PBT after exceptional items was Rs 423.9 crore in Q2 FY27, compared with Rs 458.1 crore a year earlier. Indian operations generated Rs 577.7 crore of PBT after exceptional items, while overseas operations and e-mobility recorded losses of Rs 149.4 crore and Rs 4.5 crore, respectively.

How did Bharat Forge’s US manufacturing operations perform?

Bharat Forge’s US manufacturing operations reported negative EBITDA of Rs 6.7 crore in Q2 FY27, compared with positive EBITDA of Rs 15.9 crore in Q2 FY26. Revenue nevertheless rose to Rs 475.6 crore from Rs 381.2 crore, and the EBITDA margin moved to negative 1.4% from positive 4.2%.

The US manufacturing EBITDA loss also widened sequentially from Rs 3.9 crore in Q1 FY27. PBT before exchange gain or loss was a Rs 85.7 crore loss in Q2 FY27, against losses of Rs 76 crore in Q1 FY27 and Rs 28.9 crore in Q2 FY26. The presentation provides no operating-cost or customer-level explanation for this change.

For H1 FY27, US manufacturing revenue was Rs 937.1 crore, up from Rs 759 crore in H1 FY26. However, the business moved from EBITDA of Rs 39 crore in H1 FY26 to a loss of Rs 10.6 crore in H1 FY27, while its PBT loss before exchange widened to Rs 161.7 crore from Rs 45.5 crore.

What changed in Bharat Forge’s European manufacturing operations?

Bharat Forge’s European manufacturing operations remained EBITDA-positive but PBT-loss-making in Q2 FY27. Revenue rose to Rs 931.5 crore from Rs 886.5 crore in Q2 FY26, while EBITDA declined to Rs 29 crore from Rs 32.2 crore and the EBITDA margin fell to 3.1% from 3.6%.

European manufacturing’s PBT loss before exchange gain or loss narrowed year on year to Rs 50.4 crore from Rs 52.6 crore. Sequentially, however, revenue declined from Rs 1,073.8 crore in Q1 FY27 to Rs 931.5 crore, EBITDA slipped from Rs 30.1 crore to Rs 29 crore, and the PBT loss widened from Rs 44.1 crore to Rs 50.4 crore.

In H1 FY27, European manufacturing revenue was Rs 2,005.3 crore, compared with Rs 1,938.4 crore in H1 FY26. EBITDA decreased to Rs 59.1 crore from Rs 65 crore, and the EBITDA margin declined to 2.9% from 3.4%, although the PBT loss before exchange narrowed to Rs 94.5 crore from Rs 101.6 crore.

How did Indian operations compare with Bharat Forge’s overseas business?

Bharat Forge’s Indian operations produced Rs 759 crore of EBITDA on Rs 3,422.1 crore of revenue in Q2 FY27, compared with Rs 675.7 crore on Rs 2,745.8 crore in Q2 FY26. That was an EBITDA margin of 22.2%, versus 1.6% for overseas operations, although the Indian margin declined from 24.6% a year earlier.

Indian operations recorded PBT after exceptional items of Rs 577.7 crore in Q2 FY27, up from Rs 551.4 crore in Q2 FY26. The Indian business incurred Rs 20.6 crore of exceptional items and an Rs 0.8 crore exchange loss, whereas its PBT including other income was Rs 599.1 crore.

This contrast shaped the consolidated outcome. Consolidated revenue grew to Rs 4,870 crore from Rs 4,032 crore, but consolidated EBITDA increased to Rs 778 crore from Rs 715.4 crore, causing the margin to fall to 16% from 17.7%. The overseas EBITDA decline of Rs 25.8 crore occurred alongside a Rs 83.3 crore increase in Indian EBITDA.

What does Bharat Forge’s overseas manufacturing mix show?

Bharat Forge’s overseas manufacturing revenue in Q2 FY27 was split between Rs 780.8 crore of steel forgings, or 55%, and Rs 626.3 crore of aluminium forgings, or 45%. Total overseas manufacturing revenue of Rs 1,407.1 crore was higher than Rs 1,267.7 crore in Q2 FY26 but lower than Rs 1,535.2 crore in Q1 FY27.

Both product categories declined sequentially in Q2 FY27. Steel forgings decreased from Rs 818.9 crore in Q1 FY27 to Rs 780.8 crore, while aluminium forgings fell from Rs 716.3 crore to Rs 626.3 crore; the revenue mix shifted from 53% steel and 47% aluminium in Q1.

For H1 FY27, overseas manufacturing revenue reached Rs 2,942.3 crore, up from Rs 2,697.4 crore in H1 FY26. Steel forgings accounted for Rs 1,599.7 crore, or 54%, and aluminium forgings contributed Rs 1,342.6 crore, or 46%, compared with a 56% and 44% split, respectively, a year earlier.

Conclusion

Bharat Forge’s Q2 FY27 reconciliation shows that Indian operations generated Rs 577.7 crore of PBT after exceptional items, while the overseas business lost Rs 149.4 crore. Overseas revenue was Rs 139.4 crore higher than a year earlier, but EBITDA was Rs 25.8 crore lower, with US manufacturing moving from Rs 15.9 crore of EBITDA to a Rs 6.7 crore loss.

The key unresolved issue is whether US manufacturing can reverse negative EBITDA after losses of Rs 3.9 crore in Q1 FY27 and Rs 6.7 crore in Q2 FY27. European manufacturing also remains loss-making at the PBT level, reporting an H1 FY27 PBT loss before exchange of Rs 94.5 crore despite Rs 2,005.3 crore of revenue and Rs 59.1 crore of EBITDA.