Bharat Forge Ltd — Interim / Quarterly Report 2021

Nov 12, 2021

BHARAT FORGE

November 12, 2021

To,

BSE Limited,

1st Floor, New Trading Ring, Rotunda Building, P.J. Towers, Dalal Street, Fort, Mumbai - 400 001 BSE SCRIP CODE - 500493

National Stock Exchange-of India Ltd.

'Exchange Plaza', Bandra-Kurla Complex, Sandra (East) Mumbai- 400 051 Symbol: BHARATFORG Series: EQ

Dear Sirs,

Re: Earning Update for Q2 of FY 2021-22

Please find enclosed herewith Earning Update issued by the Company for 02 of FY 2021-22.

Thanking you,

Yours faithfully,

For Bharat Forge Limited

Tej z haudhari Company Secretary

Encl.: As above

BHARAT FORGE LIMITED, MUNDHWA, PUNE 411 036, MAHARASHTRA, INDIA. PHONE:+ 91 20 6704 2476 6704 2451 6704 2544 (Secretarial) Fax 020 2682 2163 Email: secretarial@bharatforge.com WEBSITE: www.bharatforge.com CIN L25209PN1961PLC012046

ANALYST UPDATE - Q2FY22

Analyst Update- Q2FY22 Results BHARAT FORGE I .9..,

MANAGEMENT COMMENTS

-rA. DALONE HIGHLIGHTS

INDIA BUSINESS

INTERNATIONAL BUSINESS

CONSOLIDATED HIGHLIGHTS

fl1'1ANCIAL ANNEXURES

BFL 3 Month Report

"During Q2 FY22, demand continued to remain robust across most of our end markets. Total revenue grew to Rs 16,066 million driven by a sharp pick up in domestic market. However, latter part of the quarter was impacted by semiconductor shortage and logistics related issues. Despite these challenges, we posted an EBITDA of Rs 4,553 million translating into EBITDA% of 28.3%.

The international operations in Hl CY21 have registered revenues of Rs 16,632 million and EBITDA% of 11.3% which is supported by focus on cost optimization & product mix improvement.

Looking ahead into Q3 FY22, end demand continues to remain robust across segments, but to what extent the semiconductor and other supply chain issues will weigh in on OEM's ability to produce is uncertain . Sequentially, We expect the company's ~75% exposure to the domestic markets & export industrial segment will continue to do well while the performance of the export automotive business will in all probability witness a decline."

B.N. Kalyani,

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Chairman & Managing Director ..

Standalone Financial Highlights Q2 FV22

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PAT 3,117 1,668 - 703 Q2 FY22 Ql FY22 Q2 - FY21 • Total revenues in Q2 FY22 at Rs 16,066 million grew by 17.1% as compared to the previous quarter supported by 40.3% jump in domestic revenues to Rs 6,197 million.

• EBITDA margins at 28.3% in Q2 FY22 was more or similar to Ql FY22 despite input cost and logistics cost pressures.

• PAT of Rs 3,117 million in Q2 FY22 ~rew by 86.9% as compared to the previous quarter

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Review of India Business BHARAT FORGE I .; .,

,>.ti,,.

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Automotive Business: If the performance of the automotive industry in Ql FY22 was adversely impacted by 2nd wave Covid lockdown, se miconductor chip shortage has disrupted the momentum in Q2 FY22, especia lly in the Pa ssenger Vehicle segment.

Despite the cha llenges, the CV sector performance was ably supported by pick up industrial activity and fleet utilization rates. The sector production increased by 37.4% to 57,220 units in Q2 FY22. Within the PV segment, UV segment grew by 23% as compared to Ql FY22 while the Car segment witnessed marginal decline.

Strong industrial recovery in India, robust investment in infrastru cture & road constructions, etc. points to a bright future for the industry. However, there are headwinds in the form of input cost pressure, high diesel prices and disruptions such as potential market share shift towards DFC, transition to EV etc. Our investments in CLWT, strategic stake in EV start-up and significant R&D wo rk focused on E-mobility puts the company in a sweet spot, where we be lieve that we will have solutions ranging from components to sub systems and systems across the full spectrum right from 2W to Commercial vehicles.

Industrials Business: The 63% growth in revenues was primarily drive n by commencement of supply of forged aluminum Cylinders used for delivering medica l grade oxygen. Revenues from this product in Q2 FY22 wa s Rs 69 crores. Thi s product was developed & manufactured in a record time of 3 months. We co ntinue to address opportunities to grow the industrial business in India with focus on Renewable Energy, Construction & Mining and Defense. ..

Note: Others Revenue stood at Rs 1,081 million in Q2FY22

Review of International Business

STr,N0ALONE HIGHLIGHTS

BHARAT FORGE I .; .,

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Automotive Business: The recovery in the trucking industry has been temporarily disrupted due to semiconductor shortage & logistics related issues. The impact was visible on the quarterly builds in the NA class 8 truck production in Q3 CY2021 at 62,718 units as against 69,488 in Q2 CY21, a drop of around 10%. Builds in Q3 CY21 was flat as compared Q3 CY2020. While the outlook for the industry continues to remain robust, supp ly chain constraints are impeding higher production.

The PV segment especially the premium segment has been significantly impacted by the chip shortage and supply chain issues. Wh ile Ignoring the near term uncertainty, this sector continues to be an interesting space where the company continues to increase its market share in the traditional powertrain and is simultaneously engaging with customers on solutions for BEV and other technologies.

Industrials Business: The Industria l business revenues have started to recover meaningfully primarily driven by the Oi l& Gas space. With crude prices hovering around the US$ 80 mark, the viability of the sha le drilling industry has improved and prospects over the coming few quarters looks positi ve. we continue to work on addressing newer opportunities and new growth markets across geographies.

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Review of International Business BHARAT FORGE I .9.., ~-----------------------------··

Rs. Million

S f,...NDALONE HIGHLIGHTS

MANAGEMENT COMMENTS

INDIA BUSINESS

INTERNATIONAL BUSINESS

CONSOLIDATED HIGHLIGHTS

FINANCIAL ANNEXURES

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PARTICULARS	Q2FV22	Q1FV22	Q2FV21
Americas	6,793	6,247	2,791
Europe	2,545	2,645	1,502
Asia Pacific	199	265	330
Total	9,537	9,156	4,623

Consolidated Financial Highlights Q2 FY22

BHARAT FORGE I .9...,

•

Rs . Million

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Q2 FY22 Ql FY22 Q2 FY21

Particulars
Long Term Debt	24,935	26,328
WC & Bill Discounting	29,100	23,626
Equity	58,576	54,468
Cash	26,184	28,755
D/E	0.92	0.92
D/E (Net)	0.48	0.39

Standalone P&L Highlights Q2 FY22 BHARAT FORGE I .; .,

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MANAGEMENT COMMENTS		Q2FY22	Q1FY22	QoQ%	IQ2FY21I	YoY%
	Shipment Tonnage	57,094	53,512	6.7%	40,775	40.0%
STANDALONE HIGHLIGHTS	Domestic Revenue	6,197	4,418	40.3%	4,036	53.5%
INDIA BUSINESS	Export Revenue	9,537	9,156	4.2%	4,623	106.3%
	Other Operating Income	332	144		156
INTERNATIONAL BUSINESS	Total Revenue	16,066	13,718	17.1%	8,815	82.3%
	EBITDA	4,553	3,910	16.4%	1,660	174.3%
CONSOLIDATED HIGHLIGHTS	EBITDA%	28.3%	28.5%		18.8%
	Other Income	322	333		313
FINANCIAL ANNEXURES	Profit Before Tax	3,708	2,818	31.6%	1,015	265.3%
	PBT%	23.1%	20.5%		11.5%
	Exchange Gain/ (Loss)	300	4		(94)
	Exceptional Item		(616)		(29)
	Profit Before Tax	4,008	2,206	81.7%	892	349.3%
	-Profit After Tax			86.9%	703	343.4%

Standalone Balance Sheet Highlights as on Q2FV22 BHARAT FORGE I .; ., ~------------------------------··

MANAGEMENT COMMENTS Rs . Million

	Particulars (Standalone)	September 30,2021	March 31, 2021
ST. NDALONE HIGHLIGHTS	Long Term Debt	19,621	20,643
INDIA BUSINESS	Working Capital & Bill Discounting	18,856	15,567
	Equity	64,077	59,486
INTERNATIONAL BUSINESS	Cash	23,413	26,809
CO SOLIDATED HIGHLIGHTS	ROCE (Net of Cash)	17.8%	5.3%
	RONW	14.9%	5.2%
	D/E (Net)	0.24	0.16

Consolidated P&L Highlights Q2 FV22 BHARAT FORGE I K; NI

MANAGEMENT COMMENTS CONSOLIDATED FINANCIALS Q2FV22 Q1FV22 QoQ% Q2FV21 Total Revenue 23,856 21,077 13.2% 13,761 73.4% EBITDA 4,767 4,546 4.9% 1,655 188.0% EBITDA % 20.0% 21.6% 12.0% PBT 3,187 2,785 14.4% 325 880.6% INTERNATIONAL BUSINESS Exchange Gain/ (Loss) 326 (44) 7 Exceptional Items (616) (60)

Profit After Tax 2,711 1,537 76.4% (18)

I DIA BUSINESS

STANDALONE HIGHLIGHTS

FINANCIAL ANNEXURES

CONSOLIDATED HIGHLIGHTS PBT after Exchange Gain/ (Loss) 3,513 2,125 65.3% 272 Profit After Tax 2,811 1,619 73.6% (15) Associate/ JV (Profit/Loss) share (107) (91) (17) Minority Interest 7 9 14

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Rs . Million

Overseas Operations & Subsidiary Financials

BHARAT FORGE I K; N,

• Rs . Million

MANAGEMENT COMMENTS	Overseas Manufacturing Operations		Jan-Mar 2021	IApril-Jun 2020
STANDALONE HIGHLIGHTS	Total Revenue	8,533	8,099	3,493
	EBITDA	925	951	(334)
INDIA BUSINESS	EBITDA %	10.8%	11.7%	(9.5)%
	PBT Before Exchange Gain/(Loss)	246	309	(952)

Overseas Operations Sales Classifications	April-Jun 2021	Jan-Mar 2021	April-Jun 2020
Steel Forgings	6,444 (78%)	6,283 (78%)	2,956 {85%)
Al Forgings	1,889 (22%)	1,816 (22%)	538 (15%)
Total	8,533 (100%)	8,099 (100%)	3,493 (100%)

INTERNATIONAL BUSINESS

CONSOLIDATED HIGHLIGHTS

Overseas Operations & Subsidiary Financials

BHARAT FORGE I _; _,

•

Rs . Million

INDIA BUSINESS

INTFRNATIONAL BUSINESS

CONSOLIDATED HIGHLIGHTS

MANAGEMENT COMMENTS	Indian Subsidiaries	Jul-Sep 2021	April-Jun 2021	Jul-Sep 2020
::Tfl NDALONE HIGHLIGHTS	Total Revenue	373	127	178
	EBITDA	(14)	(24)	(15)
	PBT Before Exchange Gain/(Loss)	(51)	(46)	(33)

BFL + BIFL (Trading Subsidiary)	'Jul-Sep 2021	April-Jun 2021	Jul-Sep 2020
Total Revenue	14,950	12,851	10,090
EBITDA	3,856	3,619	2,004
EBITDA%	25.8%	28.2%	19.9%
PBT Before Exchange Gain/(Loss)	2,992	2,522	1,310

DISCLAMER

This presentation contains certain forward looking statements concerning Bharat Forge's future business prospects and business profitability, which are subject to a number of risks and uncertainties and the actual results could materially differ from those in such forward looking statements. The risks and uncertainties relating to these statements include, but not limited to, risks and uncertainties, regarding fluctuations in earnings, our ability to manage growth, competition

(both domestic and international), economic growth in India and the target countries for exports, ability to attract and retain highly skilled professionals, time and cost over runs on contracts, our ability to manage our international operations, government policies and actions with respect to investments, fiscal deficits, regulations, interest rates and other fiscal costs generally prevailing in the economy. The company does not undertake to make any announcement in case any of these forward looking statements become materially incorrect in future or update any forward looking statements made from time to time by or on behalf of the company. No part of this presentation shall be reproduced, copied, forwarded to any third party either in print of in electronic form without prior express consent of the company.

THANK YOU

Bharat Forge Ltd

Rajhagopalan S Tel: +91 98601 44866 Email: SRajhagopalan@bharatforge.com

5-Ancial Technologies Pvt Ltd

Vijay Gyanchandani / Vishal Mehta Tel: +91 96194 38448 / +91 93264 78472 Email: vijay@s-ancial.com vishal@s-ancial.com

BHARAT FORGE