Bharat Forge subsidiary Kalyani Powertrain Limited (KPTL) has completed the divestment of its entire 50% equity stake in Refu Drive GmbH to joint venture partner Refu Elektronik GmbH.

The transaction was confirmed in a disclosure to stock exchanges on September 2, 2026. This follows an earlier intimation dated July 23, 2026, regarding the planned divestment. With the transfer of shares, Refu Drive has ceased to be a joint venture of KPTL.

Transaction details

The deal marks the full exit of Kalyani Powertrain from the German entity. Refu Elektronik now holds complete ownership of Refu Drive GmbH. The company updated its earlier disclosures under SEBI Master Circular No. HO/49/14/14(7)2025-CFD-POD2/I/3762/2026 dated January 30, 2026, to reflect the completion of the transaction.

The move simplifies the corporate structure for Bharat Forge by removing the joint venture from its consolidated group.

Bharat Forge reported a consolidated net profit of ₹10,894 crore for FY26, marking a 19.4% increase from the previous year. The company’s revenue from operations expanded 11.2% to ₹168,117 crore, reflecting strong performance across its diversified manufacturing platforms despite global headwinds.

The Pune-based engineering major maintained its adjusted EBITDA margin at 17.4% in FY26, slightly down from 17.8% in FY25, while absolute adjusted EBITDA grew to ₹29,267 crore. The company highlighted that domestic passenger vehicle and industrial businesses provided resilience against softer commercial vehicle exports and European market weakness.

Financial Performance Highlights

The company’s profit before exceptional items and tax rose to ₹18,216 crore in FY26, up from ₹16,129 crore in FY25. This growth was supported by the consolidation of K Drive Mobility, which contributed ₹9,578 crore in revenue during the nine months following its acquisition in July 2025.

Defence and New Sectors Growth

Bharat Forge’s defence business remains a key growth driver, with an executable order book of ₹111,967 crore as of June 30, 2026. Defence revenue stood at ₹17,572 crore in FY26, broadly stable compared to ₹17,720 crore in FY25.

Key developments include:

• Secured a ₹4,258 crore Ministry of Defence contract for 12 marine gas turbine generator sets.
• Expanded capabilities in unmanned naval systems and indigenous small arms under the 'Atmanirbhar Bharat' initiative.
• Co-developed the Vikram VT21, India’s first simultaneous 8x8 wheeled/tracked-chassis armoured platform with DRDO.

Strategic Investments and Capex

The company outlined a planned growth capex of ₹18,000 crore across businesses, focusing on scaling indigenous defence manufacturing, aerospace, semiconductors, and data centre components. Recent strategic moves include:

• Acquisition of a 30% stake in Fortuna Engineering in Q1 FY27 to add machining capabilities.
• JS Autocast raised ₹3,000 crore from a private equity investor for a 23% stake to support expansion.
• Investment in Agneyastra Energetics to scale small arms machines and energetics plants.

What the Numbers Show

A notable divergence exists between top-line growth and margin performance. While revenue increased by over 11% in FY26, the adjusted EBITDA margin contracted by 40 basis points from 17.8% to 17.4%. This suggests that while volume and new acquisitions like K Drive Mobility drove revenue scale, they may have come with lower initial margins or higher integration costs compared to the core forging business. Additionally, adjusted net debt rose significantly to ₹47,108 crore in FY26 from ₹36,441 crore in FY25, indicating aggressive leverage to fund these expansion plans.

Sustainability and ESG Goals

Bharat Forge reaffirmed its commitment to sustainability, targeting carbon neutrality by 2045 and powering 80% of operations with renewable energy by 2030. In FY26, the company achieved:

• 99.3% waste recovery through recycling.
• 38% electricity consumption from renewable sources.
• A Lost Time Injury Frequency Rate (LTIFR) of 0.57.

The company maintains an AA+ credit rating with a stable outlook from ICRA and CARE.