Bharat Forge swings to ₹90 Cr consolidated loss on ₹358 Cr German restructuring charge

Bharat Forge's consolidated Q1 FY27 revenue rose to ₹4,639.9 Cr, up 18.7% YoY and 2.5% QoQ, but the consolidated bottom line swung to a loss of ₹89.9 Cr against profits of ₹283.9 Cr a year ago and ₹233.4 Cr last quarter. Consolidated EPS was -₹1.88 versus +₹5.93 YoY. Standalone (India-only) results stayed profitable — PAT ₹321.4 Cr on revenue ₹2,347.4 Cr, EPS ₹6.72 — so the loss is entirely a consolidation-level, Europe-driven event.

The swing is driven by a ₹358.0 Cr consolidated exceptional charge tied to the restructuring of German subsidiary Bharat Forge CDP GmbH: a ₹330.4 Cr provision for a social plan agreed with the Works Council, plus ₹26.7 Cr of incidental restructuring costs and a small VRS charge (note 3). Standalone carried a much smaller ₹24.5 Cr exceptional hit for the same items. Stripping the exceptional charge out, consolidated pre-exceptional PBT was ₹402.4 Cr, and adjusted PAT (pre-exceptional PBT less the reported tax charge) works out to roughly ₹268 Cr — down about 5.6% YoY and 19.3% QoQ. So even excluding the one-off, underlying profitability softened, not just the headline; operating margin compressed to 15.05% from 17.13% YoY and 17.17% QoQ, and net margin fell to -1.94% from 7.26% YoY purely on the exceptional charge.

The stock went into the print at ₹2,178.1, up 2.9% over the past month of trading.

For context: revenue is at a 6-quarter high.

This is the restructuring management had already flagged: on the May 2026 call it said it was "undertaking a strategic restructuring of its German steel forging business to improve consolidated profitability," delivered then in a confidently bullish tone. The charge materializing confirms that plan, though its size this quarter is a harder print than that framing implied. Segment-wise, growth is increasingly non-core: Defence revenue nearly doubled YoY to ₹495.7 Cr (from ₹264.4 Cr) and "Others" revenue rose to ₹627.9 Cr (from ₹279.0 Cr), while core Forgings grew a more modest 7.7% YoY to ₹3,831.1 Cr. Alongside results, the board approved raising up to ₹2,500 Cr via equity/debt instruments, incorporating a Malaysia subsidiary for semiconductor-related work, a 90% stake buy in RS Aerostructures (₹3.6 Cr) and a 30% stake in Fortuna Engineering (₹129.6 Cr, connecting rods/camshafts) — all consistent with the guided aerospace/defence push and complementary M&A. Separately, Kalyani Powertrain agreed to exit its loss-making JV stake in REFU Drive GmbH for a nominal EUR 12,500. No reliable brokerage consensus for this specific quarter could be confirmed via search, so the print's standing versus Street is unknown.