Bharat Forge Ltd. Business Report FY ended Mar. 2019

Financial Overview

-In the fiscal year ended March 31, 2019, the Company's consolidated sales increased by 21.4% at INR 101,457 million compared to INR 83,577 million in the previous fiscal year. The Company's sales were increased by increasing contribution from demand growth in the global truck and industrial sector, and ramp-up of the passenger vehicle program.

-The Company’s EBITDA of INR 20,284 million in the fiscal year ended March 31, 2018 up by 14.0% to the EBITDA of INR 17,787 million in the previous fiscal year. EBITDA percentage increased from to 20.0% compared to 21.3% in year previous.

Outlook

-Due to fairly volatile and uncertain demand environment across sectors and geographies, The Company’s focus in the coming 12-18 months shall include reducing cost, accelerating new product development, maximizing free cash generation and exploring organic/inorganic growth avenues.

-The company is planning de-risking strategy and reduced dependence on Auto sector while diversified Industrials business across geographies.

-The company is planning foray into newer sectors such as Light weighting technology (LWT) and e-mobility. Aluminum forgings will be another focus area for Lightweighting.

R&D Expenditure

(in million INR)

	FY ended Mar. 31, 2019	FY ended Mar. 31, 2018	FY ended Mar. 31, 2017
Overall	547.5	374.3	333.4

-Total R&D expenditure in fiscal year ended March 31st, 2019, is 0.8% of total turnover.

R&D Activities

-In the fiscal year ended March 31, 2019, the Company's R&D activities focused on lightweight product with better strength to weight ratio, new process development, additive manufacturing of metals, development of cold and precision forging, forging part for hybrid vehicles, development of parts of electric vehicles, component for differential gearbox, aluminium forging for MPVs, gearbox assembly for large vehicles and planet carrier assembly for HCVs.