Balu forge industries Ltd has announced a major breakthrough in its defense sector operations by securing a comprehensive five-year supply agreement for large caliber ammunition. This strategic contract represents a significant milestone for the company's expansion in the defense manufacturing segment.

Contract Specifications

The agreement encompasses the supply of specialized 155mm M107 ammunition units over the contract duration. The deal structure provides clear parameters for both volume and pricing, ensuring predictable revenue streams for the company.

Delivery Timeline and Volume Commitments

The contract establishes a structured delivery schedule with initial shipments set to begin in April 2026. The monthly supply commitment of 30,000 units demonstrates the substantial scale of this agreement and the client's confidence in Balu Forge Industries' manufacturing capabilities.

The pricing structure at $315 per unit reflects competitive positioning in the large caliber ammunition market. This fixed pricing arrangement provides revenue predictability throughout the contract term, supporting the company's financial planning and operational scaling requirements.

Strategic Implications

This five-year agreement positions Balu Forge Industries as a reliable supplier in the defense ammunition sector. The long-term nature of the contract provides operational stability and supports the company's growth trajectory in specialized defense manufacturing. The April 2026 start date allows adequate preparation time for production scaling and quality assurance processes.

Balu Forge Industries Limited has successfully completed the allotment of 16.30 lakh equity shares through the conversion of convertible warrants, as approved by the Board of Directors on February 25, 2026. The conversion represents a significant capital infusion for the company, with total proceeds of Rs. 44.01 crore received from three non-promoter investors.

Share Allotment Details

The company issued 16.30 lakh equity shares with a face value of Rs. 10 each at an issue price of Rs. 360 per share. This pricing includes a premium of Rs. 350 per share, reflecting strong investor confidence in the company's prospects. The conversion was executed at a 1:1 ratio, meaning each convertible warrant was converted into one fully paid-up equity share.

Investor Participation

Three non-promoter investors participated in the convertible warrant conversion, demonstrating institutional interest in the company's growth trajectory.

Ebisu Global Opportunities Fund Limited emerged as the largest participant, converting 11.00 lakh warrants and contributing Rs. 29.70 crore to the total proceeds.

Financial Structure

The convertible warrant structure followed a two-stage payment mechanism. Initially, 25% of the total consideration was received upon warrant allotment, with the remaining 75% collected during the conversion process. This structure provided the company with staged capital infusion while offering investors flexibility in their investment timing.

Regulatory Compliance

The allotment was conducted in accordance with Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company has duly informed both BSE Limited and National Stock Exchange of India Limited about the completion of the allotment process, ensuring full regulatory compliance and transparency for all stakeholders.