Homegrown forged components maker posts over 100% jump in net profit in first quarter
With the rise in automobile sales in the last few months, the forging industry is witnessing a sharp uptick in demand which has resulted in substantial increase in the production. Moreover, the rise in steel prices have further boosted the forging industry’s income.
The domestic forging industry primarily caters to the automotive industry, which accounts for 60-70 per cent of the forging production, according to a PTI report. Taki g a queue from the rise in demand, Balu Forge shares, a leading forging company in the country, has said that it posted massive jump in the sales in the first quarter of the current financial year.
The company in an exchange filing said that its revenue from operations increased by a whopping 112 per cent to Rs 112 crore on YoY basis. It had clocked a total revenue of Rs 52 crore in the April-June period last year, the company said in a regulatory filing.
The company’s total income went up to Rs 112.4 crore in the first quarter from Rs 55.8 crore in the year-ago period. The net profit in the April-June quarter stood at Rs 16.6 crore, which is 125 per cent up from the same period of the last financial year.
The key growth drivers in the quarter were orders from the defence industry, railways and increase in agricultural activities.
The year 2023 had a successful start with strong product demand and improved profitability. The robust performance was driven by its established product range, new product introductions and operational efficiency.
The company expects that the rebound in the passenger and commercial vehicle markets in the post-pandemic years driven by consumer sentiment will lead to great profitability in the industry.
The small cap stock that is mainly engaged in the manufacturing of industrial products, has given multibagger returns of 180 per cent in just 1 year whereas the benchmark BSE Sensex has climbed 10 per cent, according to exchange data.
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