Thank you very much. We will now begin the question -and-answer session. Our first question comes from the line of Gunjan Prithyani from Bank of America. Please go ahead.

Yes, hi, thanks team for taking my questions. My first question is on the overseas subs, which you pointed out is quite a challenging environment. You do also talk about rethinking your manufacturing presence in overseas business. Could you share more around this? Because it certainly seems that Europe will take a lot longer to turn around than what we were guiding initially. So, how should we think about the losses coming down there, or how should we think about the business restructuring that you talk about in the presentation?

Yes. Hi, Gunjan. So, in a very simple way, let me answer. Right now, there is a lot of uncertainty about policy, about what is going to be the way forward, is it a glo bal world, is it a regional world? So, like I said, we are undertaking a thorough review of our manufacturing footprint. And within six months, we will have a concrete way forward.

Okay. And is it fair to assume that the losses that we're seeing roughly about Rs. 90 crores PBT loss in the European business, that sort of stay will remain at elevated levels for another two or three quarters till we find a more lasting solution to this?

Yes. I think they'll be in the ballpark. Obviously our attempts will be to try and reduce them. But like I said, we need two quarters more, by which time we will have full clarity on our decision.

Everything is based on the current demand in the market. But we are going to take a decision based on a number of factors, and we need about six months for that.

Okay. Got it. And the second question was on the defense A TAGS order. What are the refreshed timelines there? When do we see that adding up in the order book? Anything that you can share on order book?

So, there are three steps of the process. One is the contract signing, then you have FOPM, which is the First Off Production, and then you have series deliveries. So, I think for series deliveries to start, we are at least 15 to 18 months from now.

And if I understand that correct, that means revenue approval to start is at least 15, 18 months, right?

15 months to 18 months is for the series deliveries to start. But the contract will be signed in the next, I would say, three to four months, maybe even little sooner.

Okay, got it. And last question. If there's a lot of uncertainty on this whole tariff noise. Is there anything that you are sort of hearing from your customer base because Class -8 truck does have a pretty dominant presence, right? So, how should we think about this?

Gunjan, there is no c larity on this yet. So, if you've seen the verbiage coming from the White House, they first talked about commodities. Then next week they're going to talk about passenger cars. Then they will talk about other things. So, I think we have to wait and watch.

And then EPA emission also sort of goes on a back burner for some time because you do not know how the emission regulation evolves under the under the current regime. Is that the way we should think about it, a lot of uncertainty.

So, if you are talking about the US?

Yes.

So, if you are talking about the US, generally speaking, there is uncertainty , however, states where the emission requirements or the emission laws are different from the whole country, for example, California. California has its own CAFE regulations, California air something, emission, whatever, air something. So, air regulation board or whatever it is. So, they have their own emission standards. So, those will go ahead no matter what. But that represents only a small percentage of the overall US automotive market. So, I think in general, there is going to be a rethink on the whole green push in the US, that is what we are hearing from the President.

Yes, thanks.

Thank you. Next question comes from Jinesh Gandhi from Ambit Capital. Please go ahead.

Yes, hi. I have a couple of questions from my side. One is, your comment on margin expansion of 250 to 300 basis points in next two to three years, that was for JS auto or at a consol level?

That was for the castings business, yes.

For the casting business, okay. And this would be primarily driven by operating leverage? Or do you expect that Russian business to come back, which had impacted margin?

It was a combination of operating leverage, cost reduction, product mix.

Okay, got it. And secondly, with respect to your comment on what is happening in the US and Europe with respect to EV trend reversing, do we see any risk to our aluminum forging business in both US and Europe?

No, no because aluminum forging and aluminum, in fact, is going to be common no matter whether it's EV or its gasoline. It's completely agnostic to them.

Got it. And last question pertains to our CAPEX expectation for FY '26, given that we are also now investing on the aerospace side and also the ongoing doubling of capacity in the US for aluminum forging. So, what should we budget for CAPEX for standalone and consol?

The CAPEX for the US is done, okay. And in India, we mentioned that we are setting up some new facility for aerospace and that is already now tied up. We will announce that , I mean, that is now going to take place. And I would like to let you know that we have signed a long -term agreement with a European Company to collabo rate to set up a manufacturing facility to manufacture cutting edge landing gear and other aerospace components for global OEM requirements. So, this is the first of its kind in India and will be a big boost to our overall aerospace capability and business and be unique for this part of the world.

Got it. So, overall FY '26 on a standalone basis would be investing close to about Rs. 400 crores, Rs. 500 crores or to be lower than that?

No, I would say about Rs. 300 odd crores.

Okay. And similar for subsidiaries, total CAPEX of Rs. 600 crores at consol level?

Got it. And just one clarification on the US operations. Now EBITDA losses have reduced to just about Rs. 6 crores on a quarterly basis. This would be at what level of utilization? Are we close to 80%, 85% there now?

Utilization is currently at about 60%.

60% you said?

Yes. We have reduced costs a lot and we have improved efficiencies.

Got it, got it. Great. Thank you. And all the best.

Yes. Thanks.

Thank you. Next question comes from the line of Kapil Singh from Nomura. Please go ahead.

Good evening, sir. My question is on export industrial revenues. We have seen a good growth over there. Could you give some color for that? And also aerospac e, like any numbers you can give on what is the current revenue and what is the potential of these facilities that we are setting up?

So, like we said last year when we spoke, our aerospace revenues are currently running at somewhere in the region of Rs. 50 crores, Rs. 60 crores a quarter. We expect this to go to triple- digits by next year per quarter. And this new facility that we are adding can almost help us double that capacity. This becomes our path to crossing USD. 100 million going towar ds USD 150 million, and. 200 million of business.

Okay. Thanks. And on the industrial business, if you could give some color because we saw good growth over there.

On the industrial business, the only area where we have seen a degrowth is on the high horsepower engines. And that is temporary because of some amount of inventory in the system. Otherwise, the business is doing quite well. Rail has seen a small dip as well. That's the only other thing.

Sir, I was asking about the export industrial business, which has gone from 360 to 400 Crore

I am talking about export only. Export industrial has been more or less flat. I mean, it's been up by about 7%, 8% over last year.

Yes. So, which segments have grown, that's what I would ask, sir.

Okay. And, sir, in India, you have mentioned that there is some CAPEX slowing down and that has potential to impact industrial business in the near -term. Which segments could be affected there?

I couldn't understand your question. Sorry.

Kapil sir, may we request you to use the handset, please?

Yes. On Slide 4, we have mentioned that despite CAPEX momentum slowing down and its potential impact on industrial business --

CAPEX slowdown is basically in two areas. One is on infrastructure and the second is on new capital formation in indust rial sectors. So, power plants, water projects, there's no big CAPEX that is taking place. Like in '15, '16, the big CAPEXs that were announced, or '14, '15, in these mega power projects, in these mega projects, those have now come to an end. The next set of these mega projects are now yet to start.

Understood. And sir, lastly, I just wanted to understand the exposure in case of exports. So , is there export going from Europe to the US for either Bharat Forge or from Bharat Forge customers?

No, not much. Very small.

And the tariffs which have been put in US on steel and aluminum, is there any impact on the Company or will these be passed on to the customer?

So, we do not know that yet as I told you, we do not know what the tariffs are how they will be calculated. What is the base? What exactly are the HSM codes? We do not know that yet.

Okay, sir. Understood Thank you. Thanks and all the best.

Thank you The next question comes from the line of Mumuksh Manlesha from Anand Rathee Institutional Equities, please go ahead.

Yes. Thank you, sir, for the opportunity. And good to see the two more businesses going to touch Rs. 1,000 crores. Sir firstly, just on the previous question, can you help us what was the revenue for oil and gas for this quarter and for nine months, sir?

I will tell you the growth, the growth over last year is almost over 60% to 70%. In nine months the growth is about 30%.

See, the oil and gas sector in the US is limited by only one thing and that is the ability to get the gas out of where it is coming out of the ground to where it is consumed or where it is converted into some other product . The only place today where they can do that is Texas where within Texas the oil and gas that is pumped is being consumed, in various different industries in Texas. But many of the other states where they are generating shale oil or shale gas , the pipelines are not in place. So, if you remember what President Trump said when he came to office is, I want to get the Keystone pipeline done so that the benefit o f the gas for the economy in the form of cheap energy will start. I am sure you saw that.

Yes.

So, that is going to lead to a big infrastructure boom in the US. And infrastructure boom in the US in such sectors will lead to a virtuous cycle where a lot of other sectors will get benefits. So, the construction sector, companies like Caterpillar, all these companies , companies that make power gen equipment, all of them will get benefit. So, we expect that very, very shortly once the shovel hits the dirt, you will start seeing the impacts of this.

Got it, sir. Sir, coming to different segments, just in near term sir next few quarters how do you see the run rate for the defense revenue, sir?

So, I would look at the defense on an annual basis rather than a quarterly basis. So, we had guided that we will see a close to 40% growth Y-o-Y and I think we should be fairly close to that. Maybe a little less than that because of some of the delays in the pro cesses that we had thought will be fast. But once that happens I think it will catch up.

Got it, sir. Sir, recently there was a new MOU with the L3Harris, anything to indicate what kind of opportunity this business can bring, sir?

Yes, that is a sector called C4I. L3Harris is one of the largest companies in the whole imaging and electronics that are used in defense. And this is a very large Company, L3Harris. And these are new sectors that we are getting into related to defense, electronics and systems for India.

Got it, sir. Sir, lastly, you mentioned in the presentation about the nuclear segment, nuclear industry as opportunity. Can you indicate how we are shaping up for this segment?

Yes, so there are two facets to the nuclear sector. One is the conventional large nuclear power plants that are coming up, which are either NPCL technology or foreign technology. These are typically 700 megawatts to 1,000 megawatts, or 1,200 megawatts, 1,400 megawatts per unit. And each location is multiple units , s o it can be anywhere from four to six units. If you remember, Jaitapur was supposed to be 1,600 into six, which was 9, 600 megawatts. So, those are the mega nuclear power plants. Now, India has a installed base of roughly, I think, about 10,000 megawatts or 11,000 megawatts of nuclear power. I think that is going to more than triple in the next 10 years with the projects that are announced and underway. Plus , now globally there is a push for SMR, wh ich is small modular reactors. Because of the huge energy requirements of data centers and also of EVs, and of a lot of other sectors which are going to consume non-fossil-based fuel energy, could be to generate hydrogen or whatever. So, these are going to be big opportunities. And even the Indian government has talked about allowing SMRs and private sector to get into this, so this is another opportunity.

Got it. Sir, any revenue currently sir from nuclear segment?

Yes, we g enerate anywhere between, I would say, Rs. 50 crore to Rs. 100 crores a year, depending on how much orders are there in the system. Every power plant in India has parts made by us.

And any order book going ahead, sir?

We have a continuous order book in this sector, but it's not very large. Basically, every time they are building a new power plant they place orders for various different parts. So, we make both the material and the components that come out of this. These are typically big parts, anywhere in weight from 5 tons to 30 tons, 40 tons, single piece.

Understood, sir. Thank you so much for this opportunity.

Thank you.

Thank you. The next question comes from the line of Arj un from Kotak Mahindra Asset Management. Please go ahead.

Thank you for taking my question. Sir, the first one is, given in light of what comments also you have made, and with change in the regime in the US, so effectively we had come up wit h this last man standing strategy in terms of continuity of business. So, in the current context, do you see that the long evity of our business has possibly increased? And could you comment on how you see competitive pressures, etc. as a result of this?

Arjun, I think it's too early to comment on that level of detail, because we do not know. I mean, generally, if you were to ask me, I think the longevity has gone up. But if you want me to specify, I do not think I am able to. Because on one side longevity has gone up, on the second side you have talk of tariffs and other things. So, it's very difficult to be able to, what do you call it, to bridge both and to come up with a total picture of where we stand. I can only say this that we have a strategy where we are able to utilize our assets to do multiple things, and I think it just allows us a little more flexibility and a little more breathing room to make a longer runway with our existing products, especially because a lot of the OEMs have al ready started the process of deintegration, so it gives us some bigger, newer opportunities going forward.

Sure. Sir the next question I had on the defen se piece. So, you did mention , say, for A TAGS, Howitzer, etc., s eries delivery may take 1 5 months. Is that for all such contracts? Because we are hearing there are possible contracts.

Export contracts can be much sooner, but domestic contracts there's a pretty lengthy process.

Okay. So, if we do get export contracts, that could possibly be done , r evenues may hit the revenue line-item quickly?

Yes, you saw that in the past, w e got export contracts, and it translated into revenue under six months, that’s for a product th at we already make. As such, we have increased the number of products that are already in our ready to make category, this marketplace becomes bigger for us.

Perfect. Lastly, sir, there was a news report of us possibly entering the semiconductor space. Just wanted to understand what are we targeting? What products are we looking at for this space?

I think it's too early to talk about that in detail. So, I think we will talk about that at some later point in time.

Sure. Thank you and wishing you all the best.

Thank you.

The next question comes from the line of Nitin Jain from Fairview Investment Private Limited. Please go ahead.

Yes, thank you for the opportunity. And congratulations on the resilient quarter. So, most of my questions have been answered, but I just need a few clarifications. So, for the aerospace business, you have given the triple-digit quarterly revenue guidance. So, can we expect that from Q1 FY '26 or more like --

Not Q1, but in FY '26 we would expect that.

Right. And by when would the new facility be operational?

This will be operational at '27, towards the end of '27, it takes about 18 months.

Right now, given the pluses and minuses, I would say it's overall . But that does not mean that on a profitability level it will be the same because we are hoping that we will reduce losses in our overseas subsidiaries.

Okay, that's helpful. Thank you so much.

Thank you.

The next question comes from Pramod Amte from Incred Equities. Please go ahead.

Yes, hi. Thanks for the opportunity. First, I wanted to check, in the domestic passenger vehicles you have been consistently improving the revenues in spite of the demand slowdown , what's going right here for you?

So, we have new customers and new products. That is what is helping us.

Okay. And do you expect the trend to continue in spite of the slowdown?

yes, we expect the trend to continue because most of our customers who we have got in the last few years are increasing their mobilization, and that is where we are now supplying a lot of new components, both engine, transmission, chassis , especially transmission components et c. So, that is a big growth area.

And looking at this auto expo where there have been series of EVs unveiled by the car makers, and considering your inclusive presence in cars, is there any components you are winning even in the EV space for domestic manufacturing?

Yes, we are making rotor shafts, we are making a lot of aluminum parts for electric car companies.

Yes. Thank you. This was helpful. Thank you.

Thank you. Ladies and gentlemen, we will take that as our last question for today.

Ladies and gentlemen, thank you very much for your participation and interest. It is always great to have a good dialogue with our investors and analysts. And we look forward to continuing this engagement and keeping you abreast of what is happening in our business. Thank you and have a nice day.

Thank you. On behalf of Bharat Forge, that concludes this conference. Thank you for joining us. You may now disconnect your lines.