Balu Forge Industries witnessed a significant surge of 13% today, reaching a day's high of ₹498.95 per share, up from the previous day's closing price of ₹441.30. The rally came after the company announced the conclusion of an Income Tax Department search with no adverse findings, boosting investor confidence in the precision engineering company.

Income Tax Search Concludes Successfully

Through a stock exchange filing, Balu Forge Industries announced that the Income Tax Department had conducted searches at several of their offices and factories starting January 7, 2026. The search process concluded on January 13, 2026, with favorable outcomes for the company.

The company emphasized that promoters and senior management provided full cooperation throughout the process, supplying all requested documents and responses to officials. Production remained uninterrupted, and the company's financial position was not affected by the search operations.

Strong Market Performance and Investor Interest

With a market capitalization of ₹5,645 crores, Balu Forge Industries has demonstrated impressive long-term performance. Over the past five years, the stock has delivered robust returns of 280%, significantly outperforming the NIFTY 50's return of 79% during the same period.

Notably, ace investor Ashish Kacholia, along with his investment firm Bengal Finance and Investment Pvt Ltd, holds a total stake of 2.87% in the company as per the September 2025 shareholding pattern.

Robust Financial Performance in Q2 FY26

The company's recent financial results demonstrate strong operational performance across key metrics:

Diversified Revenue Streams

Balu Forge Industries maintains a well-diversified revenue portfolio across multiple sectors in H1 FY26:

• Agriculture sector: 38% of total sales
• Commercial vehicles: 19% of sales
• Heavy engineering & industrial machinery: 18% of sales
• Defence: 10% of sales
• Power generation: 10% of sales
• Oil & gas: 5% of sales

Company Profile and Product Range

Balu Forge Industries Limited operates as a leading Indian precision engineering company, specializing in forged and machined components for global clients. The company's impressive product range spans components weighing from 1 kg to 1,500 kg, with lengths reaching up to 3 meters. Their components serve diverse applications including automotive, commercial vehicles, earthmoving equipment, wind turbines, aircraft, defence systems, oil and gas installations, railways, shipping, and agricultural machinery.

Balu Forge Industries shares experienced a significant rebound on Tuesday, January 13, jumping as much as 10% and breaking an eight-day losing streak. This marked the first day of gains for the stock in 2026, providing relief to investors after a challenging start to the year.

Stock Performance Recovery

The stock's performance showed a dramatic turnaround following recent declines:

Income Tax Investigation Concludes

The rally was triggered by the company's announcement regarding the conclusion of an income tax department investigation. In an exchange filing, Balu Forge Industries detailed that the income tax department had conducted a search under the Income Tax Act, 1961, at several of its offices and manufacturing units.

The investigation, which commenced on January 7, concluded on Tuesday with favorable outcomes for the company. The filing emphasized that the company, its promoters, and key managerial personnel provided full cooperation to officials throughout the process.

Investigation Outcomes

Key findings from the concluded probe include:

• No incriminating documents were discovered during the operation
• No documents were seized by the department
• Full cooperation was provided by company management
• All requested documents, clarifications, and details were furnished to officials

Business Operations Unaffected

Balu Forge Industries confirmed that the investigation had minimal impact on its core operations. The company stated that business operations and production continued as usual throughout the probe period, with no disruption to manufacturing activities.

Importantly, the company noted that there was no material adverse impact on its financials as a result of the investigation. Management committed to providing additional information as and when required by authorities.

Company Background

Balu Forge Industries operates as a manufacturer of crankshafts, serving multiple industrial sectors including automotive, agricultural, marine, and industrial applications. The company's products are essential components in various machinery and equipment across these diverse industries.

The successful conclusion of the income tax probe without any adverse findings has restored investor confidence, as reflected in Tuesday's strong stock performance and the end of the prolonged losing streak.