Summary:
Bharat Forge’s step-down subsidiary Agneyastra Energetics Ltd has acquired nearly 950 acres of land in Andhra Pradesh to set up a large-scale defence manufacturing complex. The facility will focus on energetics, ammunition, and propellants, with future provisions for rockets, missile systems, and space applications. The announcement comes alongside Bharat Forge’s Q1 results, which showed a 10% YoY decline in standalone revenue due to weaker exports.
Land Acquisition for Defence Complex
On September 4, Bharat Forge announced that its subsidiary Agneyastra Energetics Ltd signed an agreement with the Andhra Pradesh Industrial Infrastructure Corporation Ltd (APIIC) to acquire a land parcel of 949.65 acres in Madakasira, Anantapur district.
The land will be developed into an integrated defence energetics manufacturing hub, comprising:
- A high explosives manufacturing plant
- An ammunition filling facility
- A gun propellant production unit
In addition, provisions are being kept for future expansion into rockets, missile systems, space launch vehicles, and advanced energetics—signaling the company’s long-term vision in the defence and aerospace sector.
Agneyastra Energetics was incorporated under Kalyani Strategic Systems Ltd, a wholly-owned arm of Bharat Forge. The company said the acquisition aligns with its growth strategy and supports India’s self-reliance push in defence manufacturing.
Financial Performance: Q1 Results
The land acquisition announcement coincided with Bharat Forge’s first-quarter results.
- Revenue (Standalone): ₹2,105 crore, down 10% YoY, slightly below the CNBC-TV18 estimate of ₹2,173 crore. The decline was attributed primarily to weaker export demand.
- EBITDA: ₹571 crore, down 12.4% YoY, missing estimates of ₹616 crore.
- EBITDA Margin: 27.1%, compared to 27.9% last year, also below the expected 28%.
The performance reflects export headwinds, though analysts note that Bharat Forge’s expansion into defence and aerospace manufacturing could offset cyclicality in its core auto and forging business over time.
Strategic Outlook
The Andhra Pradesh defence complex marks a major capacity expansion for Bharat Forge’s defence vertical. With India’s defence sector seeing increased policy support for domestic manufacturing, the new facility is expected to strengthen Bharat Forge’s role as a key supplier in ammunition, energetics, and advanced weapons systems.
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