New Delhi: Bharat Forge (BFL) (CMP: Rs 499, Mcap: Rs 23,252 crore), a leading auto ancillary metal forging company, yet again disappointed with a very weak set of numbers for the December quarter. The subdued show came amid a tough operating environment in global as well as domestic automobile industries. A significant decline in volume led to a sharp fall in net revenue. Further, operating profit margin contracted due to negative operating leverage.
Demand weakness marked both domestic and international markets and is expected to linger in April-June of 2019-20. Valuation remains at an elevated level. Hence, we advise investors to avoid it until we see signs of demand improvement.
