Bharat Forge Chairman 'cautious' on outlook for US export business for current fiscal

Auto component major Bharat Forge faced challenging market conditions in its export business caused by US tariffs and regulatory uncertainties. The company is now cautious on the outlook for its US export business for this fiscal year.

"During the quarter, the company faced challenging market conditions in our export markets caused by tariff & regulatory uncertainties," said B.N. Kalyani, Chairman & MD of Bharat Forge.

Given the recent tariff announcement by the US government and changes to emission regulations in North America, we are cautious on the outlook for the US export business for the remainder of the fiscal, Kalyani said.

Bharat Forge said that FY26 is likely to be a challenging period, given the overall cycle and geographical exposure. To minimise the impact of US tariffs and other prevailing uncertainties, the company continues to focus on capturing opportunities in businesses & geographies that are relatively unaffected and work simultaneously on cost optimisation.

"Our focus is on capturing opportunities in businesses & geographies which are relatively unaffected and work simultaneously on cost optimisation to minimise impact of operating deleverage," Kalyani added.

The company witnessed meaningful improvement in US & European operations in financial performance during Q1, leading to cash profit generation.

Bharat Forge is reviewing European steel manufacturing footprint as it expects to have concrete steps in place by the end of this year.

Standalone Revenues of Bharat Forge declined by 2.7% sequentially to Rs 2,105 crores, impacted by 12.7% drop in export revenues.

The company reported that Q1 FY26 Revenues at Rs 21,047 million were lower Q-o-Q due to challenges arising from the tariff policy, roll back of emission norms change for Heavy trucks in US, and seasonality in the Aerospace business.

"North American CV revenues saw a decline due to a pause to the emission norm change and the ongoing trade policy flux in US," the company said.

During the quarter, the company secured new orders worth Rs 847 crores, including Rs 269 cr in Defence. As of Q1FY26, the defence order book stood at Rs 9,463 cr.

"For the defence vertical, based on the project/platforms we have participated in, we expect to secure new orders in this fiscal year, generating more revenue visibility for the future years," the Chairman said.

On Tuesday, US President Donald Trump signaled a sharp increase in his trade stance against India, saying the tariff rate is likely to be raised "substantially" within the next 24 hours after imposing a blanket 25% tariff on all Indian imports.