“The quarter gone by was a repeat of the previous quarter in terms of weak end market demand and financial performance. Domestic and export revenues were down more than 30% in Q3 FY20 compared to the same quarter previous year.
The Passenger Vehicle business continues to stands out across both domestic and export markets with strong outperformance against underlying demand. The PV business grew by 8.7% compared to same quarter last year.
BFL’s international operations in Europe have also been badly impacted by the decline in end market demand. We have initiated restructuring & cost optimization actions. These actions coupled with investing in creating capacity towards a favorable product mix will eventually result in a sustainable & stronger business overseas.
We continue to strengthen the Balance Sheet with cash of ~Rs 1,930 crores on books as of December 2019 while the return ratios were sub-par driven by underutilization of capacities.
Looking ahead, over the next 3-6 months, we expect demand to remain soft given the uncertainty in India due to the transition to BS VI and continuation of weakness in North America & Europe. However, we believe that the phase of sequential decline in the financial performance for the company is nearing an end and the new phase of growth will commence in FY21. The convergence of our cost reduction initiatives and business development will enable BFL to come out stronger from this current down turn” B.N. Kalyani, Chairman & Managing Director.
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SOURCE: Bharat Forge
