Bharat Forge stock rides global demand rebound for trucks, defence spend boom

The stock of auto component major Bharat Forge hit fresh all-time highs on Friday, supported by multiple triggers across its key business segments.

- RAM PRASAD SAHU

The stock has been the top gainer in the BSE 200 index over the past month, rising 24 percent during this period.

The rally has been driven by a recovery in Class 8 truck demand in the US, strong commercial vehicle (CV) demand in the Indian market, improving prospects in the oil and gas segment, and expanding opportunities in the defence space.

However, the sharp gains of about 68 per cent over the past six months have pushed valuations into premium territory. At the current price, the stock is trading at more than 46 times its FY27 earnings estimates.

‘The immediate trigger for the recent surge has been sales of heavy trucks (Class 8) in the key North American market. Preliminary net orders jumped 47 percent month-on-month and 159 per cent year-on-year to 47,200 units. This marks the highest level in the past three and a half years and the third consecutive month of order growth exceeding 20 per cent.