One of the small-cap stocks engaged in the manufacturing of fully finished and semi-finished forged crankshafts and forged components. The stock has jumped 5.03 percent after announcing the addition of capacity for high-precision machining.
Stock Price Movement:
In Tuesday’s trading session, Balu Forge Industries Limited’s share jumped to an intraday high of 5.03 percent from the previous close of Rs. 802.50. The stock opened at Rs. 817.95 and is currently trading at Rs. 832.85, with a high of Rs. 842.90 and a low of Rs. 798.85. The market capitalization now stands at approximately Rs. 9,114.87 crore.
What Happened:
Balu Forge Industries Limited has announced the addition of capacity for high-precision machining with the introduction of 7-axis CNC machining technology. The company has an existing capacity of 32,000 tons and a utilization rate of 70%.
The company aims to complete the expansion within FY 2025-2026. An initial investment of Rs. 21.04 lakh has been made for the first machine, purchased through internal accruals. The expansion targets sectors such as aerospace, defense, railways, and oil & gas, aiming to enhance precision, flexibility, and product complexity.
Products and Services
Balu Forge Industries specializes in producing fully finished and semi-finished crankshafts for automotive, agricultural, marine, and industrial sectors. The company also manufactures a wide range of forged components, offers precision machining services, and enhances parts through heat treatment and surface finishing for improved strength and durability.
Global Presence
Balu Forge has a robust global presence, exporting to over 80 countries and serving more than 25 OEMs. The company is ISO/TS16949:2009 accredited, underscoring its dedication to maintaining high-quality standards across its products and services.
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Recent quarter results and ratios:
Balu Forge Industries Limited’s revenue has increased from Rs. 139 crore in Q2 FY24 to Rs. 223 crore in Q2 FY25, which has grown by 60.43 percent. The net profit of Balu Forge Industries Limited has also grown by 108.7 percent from Rs. 23 crore in Q2 FY24 to Rs. 48 crore in Q2 FY25.
Balu Forge Industries Limited’s revenue and net profit have grown at a CAGR of 57.99 percent and 127.34 percent, respectively, over the last three years.
In terms of return ratios, the company’s ROCE and ROE should be 30 percent and 25 percent, respectively. The debt-to-equity ratio of the company is to be 0.06x, which shows the company is almost debt-free. Balu Forge Industries Limited’s EPS is to be Rs. 13.
Shareholding pattern
In September 2024, Balu Forge Industries Limited had a majority stake held by the promoters at 54.71 percent, foreign institutional investors at 10.43 percent, domestic institutional investors at 0.93 percent, and the public at 33.93 percent.
In the public holding, Ace Investors Ashish Kacholia has held a stake of 1.82 percent in Balu Forge Industries Limited. He has decreased his stake from 2.14 percent in June 2024.
Company Overview:
Balu Forge Industries Limited was established in 1990 in Belgaum, Karnataka. The company is a leading Indian manufacturer of precision-engineered products, specializing in crankshafts and forging components.
The company produces fully finished and semi-finished forged crankshafts and components, catering to various industries globally. It also manufactures components that meet new emission regulations and the requirements for new energy vehicles.
Written By – Nikhil Naik
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