Bharat Forge Limited (BHARATFORG) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the Q4 and FI26 Earning Conference Call hosted by Bharat Forge Ltd. This conference call may contain forward-looking statements about the company which are based on beliefs, opinion and expectation of the company as on date of this call. These statements are not the guarantee of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant line will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call? Please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Amit Kalyani, Vice Chairman and Joint Managing Director, Bharat Force Limited. Thank you and over to you, sir.

Good afternoon, ladies and gentlemen, and thank you for joining our conference call today. As is standard, I will first introduce the people with me, and then our CFO, Kedar Dixit, will take you through the numbers. So I have with me my fellow board member and head of the components business, Subot Tandale. I have Kedar Dixit, our CFO, I have Raj Gopal, our... Head of Investor Relations and M&A and Chinmay and Sameer. So, over to you, Ketar.

Thank you. Good afternoon, everyone. We will start with the performance review of consolidated results, given that number of initiatives and investments we have made in new verticals as well as in the Indian manufacturing space. We ended the year with revenues of 16,812 crores and EBITDA of 2,921 crores, which has a growth of 11% in revenues and about 6% in EBITDA. Consolidated net debt equity stood at 0.41 as of March 2026. During the year, the company also secured new businesses worth 4,814 crores across all key businesses, which includes the traditional business of 1,210 crores, defense 2,816 crores, JSA, which is our casting unit, 292 crores, and KRAI, which is the recent acquisition, is about 500 crores. Talking about the standalone performance, the standalone business reported a revenue of 8,396 crore, which was lowered by about 5% year over year. This was mainly on account of regulatory uncertainties in North America and demand challenges in U.S. CV market, which has impacted the performance. But as we speak, we are looking at good growth in this sector. Standalone EBITDA for FY26 was at 2,312 crores, considering EBITDA margin of 27.5%. PBT before exceptional items was 1,826 crores, which was about 8% lower YOY. Talking about the quarterly performance, standalone revenues for the quarter was up by 8.5% quarter over quarter at 2,260 crores. The quarter-over-quarter improvement in performance was driven by all-around recovery in exports and strong performance in domestic automotive segment. Q4 was up at 7.2 percent sequentially at 610 crore, translating an EBITDA margin of 27 percent. This also includes one-time cost, retrospective cost by Emissive Ethel, which had charges retrospectively success on the captive power, which is about 11 crore. Without that, the margins would have been closer to 28%. PBT before exceptional item was about 486 crores. During the quarter, The other company has absorbed tariff impact of about 12 crores. Balance sheet continues to remain robust with net debt to equity at 0.18 for the year. Talking about the overseas business, we have initiated the restructuring of our German steel business, which is CDP Bharat Forge. We expect to complete the process by end of next calendar. For other businesses in Europe, we are simultaneously pursuing various business opportunities to leverage the scaled-down manufacturing footprint. Performance-wise, EU operations registered revenue of 3,865 crores and EBITDA of 151 crores, resulting in EBITDA margin of around 4 percent, while U.S. operations recorded revenue of 1,534 crores, EBITDA of 54 crores, translating into EBITDA margin of 3 and a half percent. I will hand over to Amitra for this call.

Good afternoon, ladies and gentlemen. You know, 2026 was a very interesting year. It had its own set of challenges, yet I think our team rose up to the challenges and really performed exceptionally well. It also was a year with a lot of uncertainty, especially to do with tariffs, which to some extent persists, and then we ended up towards the end of the year with a full-blown war taking place in the Middle East. Which luckily enough seems to have subsided right now and if everything goes well, it should really settle down and get resolved. I think this has had impacts and uncertainties on markets, inputs, transportation and many factors of Given that background, I think we have weathered the storm well and ended on a stronger note with very good momentum going into the new year. I want to especially commend our sales and marketing, customer-facing teams, our supply chain teams, our operating teams, and all the people in our company for really giving it their all and making this year, let's say, painless for our customers. Driven by a combination of new business initiatives and M&A over the past three years, BFL is now an engineering conglomerate entrenched across processes, customers, and segments. This is an example of how we transform every five, six years. Our balance sheet continues to remain one of our key strengths with a strong net cash position at a standalone level. The aerospace business, which we have been talking about for quite some time, I am very happy to report is now a meaningful part of our industrial exports and is now almost 26% of the last quarter's exports and is the second largest contributor to our industrial exports now. This segment has seen multiple new business wins, both across jet engine, structure, landing systems. We were recently selected by an Aerospace OEM as their first supplier from India for any critical components. Our acquisition of K-Drive is making significant progress and has also won a lot of new business from OEMs which will start panning out from this year. On the defense front, our business has spread well beyond artillery and vehicles. To include small arm, naval solutions, and a wide variety of unmanned platforms, both sea and air. The recent order wins are a testament to the progress made here. With an order book of close to 11,000 crores, the next 3-4 years will see stable revenue efficient in these sectors. In parallel, we are also focusing on expanding our product portfolio and participating in new programs to build a robust and scalable revenue pipeline over the medium to long term. I particularly see new opportunities in Europe for our defense business. Castings, despite the challenges in the export market, especially in the wind sector because of the slowdown in wind infrastructure buildup, We have seen JSA continue to grow and increase both revenue and profitability going forward, and we are now expanding our customer base to cross-fertilize and to cross-sell these products into our existing customer base in the automotive and commercial vehicle sector. The recent capital raise from FrameG Invest will help us drive capacity expansion and make this business an independent road driver for Bharatpoj and the Kalyani Group. This week, we acquired a 30% stake in Fortuna Engineering, which is a company based in Nasik. This has a strong and experienced management team led by the promoters in machining, and it strategically is a very complementary fit to us because they do machining of connecting rods and some other high-value components, which are all complementary to what Bharat Forge does, and in fact, also allows us to supply, I am in to them. You know, the first components that they can machine. The company has a strong balance sheet and a net cash position. In e-mobility, as I mentioned, in the... Television interview earlier, we have decided to take a write-off of those investments where we don't see any immediate revenue and business ramp up because it doesn't make sense to spend time and effort on those areas which are not going to give us returns immediately. As you are aware, globally, the electric vehicle adoption has taken a different trajectory as compared to what was originally envisaged. Additionally, our overseas business... We will also see a restructuring with our steel-forging business undergoing a restructuring as we have explained earlier. We also intend to evaluate additional business opportunities in the automotive sector to leverage our market position, our customers, and our footprint globally. To look at 2027 as a whole, I think it's going to be a strong year for India manufacturing operations. As the growth impetus across sectors and the kind of strategies we have put in place will bring in higher execution and growth. Barring any further geopolitical crises and their impact on demand, we should see a close to 25% plus growth in our India business. Our ongoing capex programs across coaching, casting and products platform will translate into 800 to 850 crore capex in a 15-20 month period. We continue to evaluate potential M&A opportunities in India to address opportunities in the high-growth sector, which may be complementary and a good fit to our existing business. Thank you. I will now be happy to, my team and I and both will be happy to take your questions.

Thank you, Sommas Singh. Ladies and gentlemen, we will now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Our first question comes from the line of Kapil Singh from Nomura. Please go ahead.

Good afternoon, sir. Congratulations on a good performance for the quarter. Firstly, I have a question on your target growth for FI27. Could you give some more color and break it down between different segments broadly, what kind of growth you expect in defense?

I'm not going to break it up into that much detail. Let me just tell you, we will see the highest growth coming from our aerospace business, and then defense business, and the automotive business. When I say automotive, I mean the components business, which includes both automotive and industrial.

Okay. And, sir, what is the outlook for domestic and global TV?

Outlook is strong for both. U.S. is very strong and so is India.

Okay. Sir, you also mentioned that... We have acquired Fortuna. Could you give us some color in terms of revenues, where does it stand, and what is the potential here?

Yeah, so we have acquired 30% for 130 crores. The company has a revenue of about 380 crores, and they have a net cash position of about 20 odd crores. And they are on a growth path to increase, you know, multiple eggs. By setting up new machining lines, and also we will open doors to them for our customers, because they don't make the very large parts that we make. So, large connecting rods is a big opportunity to supply globally.

Okay. And will it be safe to say that the growth target also includes inorganic opportunities like these?

So, we don't currently have any other inorganic, which is ongoing, but as we have mentioned, we will look at opportunities within India that make sense for us. In the auto-portage.

Just one last question. You mentioned that the electrification has taken a different path from what we were originally anticipating. Could you elaborate a little bit?

Yeah, you know, about five years ago, there was a very strong focus on electrification across the board, including commercial vehicles, including heavy commercial vehicles. However, it is definitely not seeing the same kind of, let's say, trajectory as what was anticipated. Secondly, even the large European OEMs, are not as successful in the passenger car sector on electrification. As you have seen, both, you know, Porsche, Ford, many companies have had massive hits and write-offs because they have not been able to build a platform that has been as competitive as those that the Chinese offer. So, there has definitely been a... Recalibration of everybody's EVs parity globally, except the Chinese, of course.

Okay. Thank you, sir. That's all from my side. That's Rishi.

Thank you. Our next question comes from the line of Bine Singh from Morgan Stanley. Please go ahead.

Hi team, congratulations.

Sorry, we can't hear you. Can you speak a little louder, please?

Hi, team. Congratulations on this set of numbers. My first question is on your restructuring. You know, you highlighted that it will conclude by end of CY27. So could you share your thoughts on that? And in the intermittent phase, which is this year and next year, will the losses be at similar level? Like this year, you had almost a 300 crore loss or so on the Europe and U.S. operations. So happy to hear your comments on that.

So the restructuring of CDP has started. This is a 15-18 month process where we have to meet the customer requirements and also do a solvent liquidation of the company. We anticipate the losses will reduce because the CDP losses are not going to be there. Whatever is there will be part of the restructuring. So, hopefully, for the year that goes by, we will have a better performance from our overseas subsidiaries.

Thanks, thanks for that. Just on aerospace, what exactly was the number for FY26 for you?

It was about 400 crores.

And lastly, just on defense, in the last call, we talked about revenue guidance on defense of 30 to 40%. But just looking at the order book, what are the key sort of milestones to watch out for? You've talked about opportunity in Europe and all, but any key things that we should expect or milestones to see this year?

So the first thing that you should look at is the fact that the A-tags... FAT will happen and then the ATAC's production will start and ramp up. The second is the CQB carbine also production will happen. So those are the two big milestones that will move the needle, starting this year and then it will continue next year and year after next as well.

Anything on the order backlog, any large project that you are putting?

This will start in the second half of this year. Please remember.

Yeah, yeah, yeah. And anything on the order wins, any incremental order book?

So we have, as Kedar mentioned in his initial talk, we have won new orders in defense as well, in the space of naval and drone systems. And we have lots of other new products that we are both developing and fielding that go into a variety of platforms, including Navy. And hopefully those should all now start, you know, the bids should open and then we should know where we stand.

Great, great. Thanks, team.

Thank you. Our next question comes from the line of Gunjan Prithiani from Bank of America. Please go ahead.

Yeah, hi, thanks for taking my question. Just a couple of clarifications on this aerospace and defense. In aerospace, you mentioned 400 crores per full year, and you also mentioned 26% of exports in waterfall, which essentially means exit run rate of almost 300 crores. So, is that the number we sort of worked through for the next year, that it can be 1,200 crores aerospace?

What I said is that industrial exports For Q4, aerospace was about 26% of the overall export from industry.

Okay.

So, in any case, if you look at 400 crores as the business we did for the whole year, we will see a strong double-digit growth, higher than the overall growth that we are anticipating as a company, significantly higher.

Okay, got it. We're just similar like what you're saying for defense as well, like 30-40% sort of growth. So, these businesses sort of clog that number.

As I mentioned earlier, the highest growth will be aerospace, then defense, and then the components business. And in components, I include all the components that we make.

Okay. Got it. And again, the clarification on the sub-piece that you mentioned, the restructuring as initiated, do the losses from this German subsidiary completely go away from the operating number because restructuring is bigger?

Sorry, what? What will go away? No, it will go away when it gets warmed up.

Which is basically end of next year, next year. Okay, got it. Now, just moving to the data centers which was mentioned in the media, is there something that you just want to give us a sense on what are we doing there?

No, I don't want to talk more about it, but suffice to say that, you know, a data center has a large amount of manufactured input that goes into it in the auxiliaries, in, you know, every element of managing, powering, and supporting a data center. And those are all areas where we supply product into.

Okay, got it. And last question on the, you know, just the TV business, both in Class 8 as well as in India. I think just generally there is a concern that you know, as energy prices, particularly we've already seen them move up in US. How do we think about, you know, how confident are we of the growth outlook, both Class 8 as well as the India TV?

Yeah, my colleague will both answer.

Thank you. Thank you.

The existing, like, pipeline that you...

Kunjan, I'm sorry to interrupt you, but you may please rejoin the queue for more questions.

All right. Thank you, Sunil.

Ladies and gentlemen, in order to ensure that the management will be able to address all the questions from the participant, we request you to kindly limit your question to two questions per participant. If I have a follow-up question, please rejoin the queue. Our next question comes from the line of Arvind Sharma from Citibank. Please go ahead.

Hi, good afternoon, sir. Thank you for taking my question. On the 25% growth target for the area operations, will it be possible to share how much would be in this standard-on business? How much do you expect in the Indian subsidiaries?

No, you know, I'm not going to break it down into all that. It gives too much information. Let's just limit to say that it's going to be at an overall India level. Correct.

So it will be between the standard and the standard. That's correct. It will be the combined standalone as well as the Indian subsidiaries. That understanding is correct? Sure, sir. Sir, also on the orders that you alluded to, almost 4,800 crores, the difference orders of 2,800 crores, what would be the typical gestation period of these new orders one? Just from our perspective, you know, when should we... How do you expect the revenue to start accruing? Is there something that you can share?

Yeah, actually we talked about this a little while earlier, that if you look at the ATAX order, that will start revenue in the next half of the year. Same with the carbines. And some of the data center orders will also start slowly from the end towards the third quarter, fourth quarter, and then really ramp up next year. But everything will start ramping up from this year. I mean, product development will start from this year and ramp up next year.

Thank you, sir. And sir, if you just comment on the commodity costs, anything that you would like to stress upon?

So, right now the biggest issue on cost is energy cost, which has gone up quite substantially, and elements that depend very heavily on energy, those have gone up. But that we are negotiating with our customers to get compensation. Correct?

That's all for my sector. Thank you so much for being with us.

Thank you.

Our next question comes from the line of Pramod Amteh from Incred Capital. Please go ahead.

Yeah, hi. Thanks for taking the question. So, continuing on the previous question in terms of cost, do you see worst is behind or it's still a very volatile environment? And also, similarly, in terms of supply chain challenges, how are you seeing it through?

You know, you have to take a day at a time because, you know, we are living in a time where what's happening in the world depends on which news channel you watch. So, you know, it's not really the old rules of the game anymore. Every hour, every minute things are changing, but, you know, we are doing the best we can. So, as a country also and as an organization also. I don't know if I can say the worst is behind us.

And the second one is with regard to the recent acquisition for machining facility. You already have a machining facility in-house, and this seems to be like your captive facility which you acquired. What's the reason to do it, and how do you see make versus buy in such form decisions? Is there any worthwhile time saving you are doing here or capability addition?

Sorry, sorry, Cesar again.

No, I said you have bought this entity.

Yeah, go ahead, Subodh. So, Pramog, the reason of acquiring this entity... Yes, we also cannot do everything ourselves. We need the bandwidth to... We will also be addressing many.

And you mentioned top line and top WP.

I'll add to one thing Subodh said, it's not just growth, it is sparse growth.

And what type of margins does it operate in, EBITDA margins or EBIT margins, that business?

You know, it's mid-teens.

Thanks and all the rest.

Thank you.

Our next question comes from the line of Nitin Arura from Access Mutual Fund. Please go ahead.

Just on the explosive side of the defense, how are we thinking about this business? Because there is a lot of demand globally as well. So when do we see this CAPEX happening and when do you see scale starts becoming bigger for you, just on the direction side?

So, first of all, we don't have an explosive problem right now.

Right.

But as we have mentioned, Mr. Auro. We are planning this.

So, FI-27 is where we see, sorry, FI-28 where we see, you know,

pretty heavy, and how much CAPEX, yeah. Hello, a lot of approval. By the end of this year, and that should be ready in less than 15 months. And then, you know, another six to eight months from then, we should be able to start pilot production. We are talking about roughly 24 months.

Got it.

Thank you very much.

Thank you.

Thanks a lot. Thank you. Our next question comes from the line of Sonal Gupta from HSBC AMC. Please go ahead.

Yeah, hi. Good afternoon, and thanks for taking my question. Amit, it's very heartening to see we're aggressively moving, and you've done a lot of acquisitions this year in India, I mean, like with the K-Drive as well as Fortuna. So, in that context, I just wanted to understand the capital raise, external capital raise in JSA. Why are we doing that? I mean, that's something that we can internally find.

You know, that is a minor thing, actually, and honestly, we see a large opportunity in We wanted to make it an independent business and grow it because we see that that business could become, you know, a multi-thousand crore business per year. Because if you see the biggest ingredient of... You know, in that industry is energy and raw material. And both those factors are not available in required quantity or price in Europe. So we see a large opportunity to move that manufacturing into India. So we want to expand that fast. And we want to do it with its own momentum and steam. So that was the reason to do it. And, you know, I think there are other synergies that could come out of that relationship as well.

So, you're saying that by doing this external, they can grow faster than what they would have done if we'd done internally?

Yeah, I also want to build a new model where companies that we buy, which are like that, you know, become more focused on their own growth. And become self-sufficient. Yes, we will support them on, you know, whatever customer connect, etc. that we can do, but I think they need to drive their growth more aggressively and not get limited by, you know, just what we can provide.

Okay, and sorry, the second question I had was on the ATACs. I mean, what sort of capacity have we now ramped up to, and when do we see this?

So, we talked about this, that second quarter, second half of this year, we will see that FAT getting completed, and then hopefully production and supplies to start.

So, I think earlier you mentioned that we were initial capacities like 5 guns a month. Is that what we are looking at?

Yeah, that's what we can do, yes.

Okay, great. Thank you so much.

Thank you. Our next question comes from the line of Ronak Singh V from NFA asset managers. Please go ahead. Hello, thank you for taking my questions. Am I audible?

So, I want to get specific about the 155mm artillery shells, so what is the current capacity?

Okay, so like, can you just say, further you are gonna go into explosives or

precision guidance or just the empty shells? Thank you. Our next question comes from the line of Nitin Jain from Fair Value Equity Advisory. Please go ahead.

Yeah, good afternoon, and congratulations on a good quarter. So, my first question is on the aerospace business. If you could provide some outlook on the business, where do we see it in the next three years, and what are the kind of margins we have here? Like, are they above company average or inline?

So, I would say the margins are above the company average, and if you remember, Mr. Jain, that over the last three years, we had said the first goal is to get to 5, 6, 700 crores, and then, you know, get to 1,000 crores. I think that we are on that trajectory, and sooner than later, we should cross that, and then be on a very fast growth path after that. You know, getting to the first 1000 crores is hard. After that, it becomes, you know, you create lines of business, you create product strategies, and then multiple products can become 400-500 crores each, maybe even more. So we're on that path.

Okay, so safe to assume that we are targeting around 1000 crores in the next 3 years or so?

Easily, easily.

I would say even more. Great. So, can you provide some color on the kind of revenue opportunity we are targeting in the server manufacturing business in the next few years?

No, no, no. We are not looking at that business aggressively. You know, we were trying to look at that business to understand the data center market. And I think we have understood what we want to do and what we don't want to do. There are some specialties. Opportunities where there are certain critical clients who want domestic made servers, made by an Indian company, those we will look at. Those are not very large opportunities at this point in time. They are more a strategic opportunity and it's an opportunity to get into the whole value chain of the data center. So that's what we're looking at it as. I wouldn't look at it as getting into electronics in a big way kind of thing.

Okay, that's quite helpful. Thank you, and congratulations, everyone. Thanks.

Thank you. A next question comes from the line of Mitesh from Aditya. Please go ahead.

I have a question regarding the Orista project. Sorry, which company are you with? Aditya Equity Investments. Sorry, I forgot to write the full name. Hello?

Yeah, go ahead. Please go ahead.

Yeah, I had a question regarding the Orista project. So, when is the environmental clearance expected for the project? And when do you expect to break ground for the project?

We are waiting still. So, I don't know, maybe another 2-3-4 months. Thank you.

Our next question comes from the line of Heth Raichwara from Ananya Research. Please go ahead.

Hello, sir. Good afternoon. I just wanted to understand that the last one of the questions...

I'm sorry, sir, but your voice is not audible.

Yes, sir. So, I just want to understand... Gross block trajectory and the targets for the next 3-5 years, particularly, as I want to say.

Please, please take this offline. We're not able to hear you. I think you should call our team separately and talk to them. We're not able to hear you at all.

Fine, I'll talk.

Thank you. And next question comes from the line of Rakesh Roy from Boring AMC. Please go ahead.

Yeah, hi, sir. My first question is, sir, can you give me the full year difference revenue for FI 26?

1,300 crores. 1,300 and... Sorry, full year revenue for FI 26. Sorry, 1562 crores.

Right, sir. My next question, sir. Recently, Army issued an RFI for bulletproof carrier. Are you waiting for this?

Lots of new programs with the army.

Okay, and can you highlight on this, sir, recently one product is launched, one product is launched in defense, especially Vikram VT21 with DRD1 Tata. How is the market size and where we are currently?

Sorry, sorry.

Vikram VT Tata.

Yeah, we launched our VILT platform. And we also had our track platform there.

Right, and how is the market? My question is, sir, how is the market size for this product, especially for army?

Replacing the old BMPs that the Indian Army has huge numbers of.

Okay, any idea how much number for domestic market and for export market?

Normally the market is in tens of thousands.

Oh, great, sir. Yes, thank you, sir. Thank you.

Thank you. Our next question comes from the line of Mahesh Vendray from LIC Mutual Fund. Please go ahead.

Hi, sir. Thank you so much for the opportunity. Sir, what kind of capital expenditure are we looking for next three years?

I'm telling you right now, what we have ongoing between last year, this year, and between last year and this year will be about 800 crores.

Since the defense business is becoming bigger and with various dimensions, any plans of hiving of this business? Maybe creating a new entity or bringing in... I mean, we haven't thought about it.

As you know, we've already spun it off into KSSL.

Right, right. But in terms of creating value for investors, are there any plans... I hope we are creating value. In terms of listing this. And we will look at it separately.

Okay, sure.

Thank you. Thank you so much. Thank you.

Thank you. The next question comes from the line of Nitin Jain from Farewell Liquidity Advisory. Please go ahead.

Yeah, thank you for the follow-up opportunity. My question is, given the importance of drones in modern warfare, like we have seen in Operation Sindhu and other operations, what kind of presence do we have in drone manufacturing?

We are already making drones for land, sea, and air. I would say that undersea and the sea part we are very strong in, the air part we are getting stronger, the land we need to do more work. We have already won borders in both the air and the sea domain.

Right. Would it be possible to provide any percentage in terms of our defense?

No, not right now.

Okay. Thank you. Thank you.

Thank you. Ladies and gentlemen, that was the last question for today. I now hand the conference over to Mr. Amit Kalyani for closing comments. Thank you, and over to you soon.

I think if there are any last questions, you know, one or two, let's finish them, and then we can close. I just saw that there are two names.

Sure, sure. Sure, sure, sure. Our next question comes from the line of Akshay Karwa from Abiba, India. Please go ahead.

Hi, Amit, sir. Good afternoon. The question is pertaining to jet engines.

Sorry, Akshay can't hear you.

You are audible now?

Go ahead.

Sir, my question is pertaining to manufacturing of jet engines. So, with the recent companies coming, with private companies coming to Pore for this, How long do you think would we be ready to create our own localized jet engine in the near term?

So are you talking about an engine for a manned or unmanned platform?

Manned platform, sir.

Manned platform will take quite some time. I would say not less than 5 to 10 years. But unmanned can happen very, very fast. Already we are supplying small jet engines for Number of drones, and we are now going to be making bigger ones also for unmanned systems, and these are completely made in India in house. They are designed, engineered and manufactured. Range of 40 kilos to 150 kilos.

My question is around the recent AMCA engines. So, regarding that, as you said, Hypertension. So, which of the companies would be able to get this order sooner?

AMCA loop, the whole program is going to be a down selection first of the consortium, and then first prototype in 32. Okay? So, it's still a long ways away, and initially, AMCA will be powered by imported engines.

Understood, sir. Thank you, sir. That's what I'm going to say, and wish you all the best, sir.

Thank you. Last question comes from the line of Radha, from Modula Rosalpdiscoet.

Thank you for the question. Sir, my question was on K-Mobility business. Can you give us some insights on how the growth will be driven in this business beyond the normal CV industry growth? Will it be exports or gaining new customers or will it be from hybrids and EV?

Good question. Rather, we are looking at the specialty axle business and the LCV and SUV axle business including EV for those, both ICE and EV. So that is what is going to drive the growth there.

Can this take the business 2 to 3x in the medium term? Is there this kind of scalability opportunity?

Yes, there is. 2x in the next 3 to 4 years is definitely possible. And if we are a little more lucky and we get into some speciality, it could be even better.

And what is the peak margins that can be made, sir, in this business?

I think it's too early to say, but, you know, our goal is a good teen, mid-teen margin in this business.

All right, sir. Second and last question is, how is the demand scenario in North America and Europe, passenger car segment, and what is driving the demand here?

So what is the answer? The demand in the U.S. is stable. When I change stable, you know, Lafayette is...

Thank you and all the thank you.

Thank you. Ladies and gentlemen, thank you very much for your time and interest and your support to our company. Really appreciate it, and we will remain in touch, and our teams are available if you need any further input. Thank you, and have a nice day.

Thank you, sir. Ladies and gentlemen, on behalf of Bharat Force Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.