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Bharat forge announced that it has successfully closed its QIP

ICICIdirect Research 23 Sep 2026 DISCLAIMER

News: In a press release, Bharat forge announced that it has successfully closed its QIP, raising ~₹2,000 crore through the allotment of 1,05,82,010 equity shares at ₹1,890 per share, a 2.96% discount to the ₹1,947.70 floor price. The issue, which opened on September 17 and closed on September 22, was subscribed by eligible institutional investors, with the fresh equity increasing the company’s capital base.

View: The funds of ~₹1,028 crore is earmarked for purchase of equipment and machinery/capital expenditure, ~₹94 crore for repayment of buyers’ credit obtained for capex, and ₹451 crore for investment in wholly owned subsidiary Kalyani Strategic Systems (KSSL). The KSSL investment is intended towards its own capex, funding KSSL’s investment in its wholly owned subsidiary AEL for capex, and product and technology development. While the ₹1,890 QIP price is below our target price, the fund raise is not earnings-accretive to our financial modelling in the near term, as the additional equity results in dilution and the benefits from the investments will take time to flow through earnings. Nevertheless, the capital raise is structurally positive in nature, given that the proceeds are intended to support capacity expansion at the standalone business as well as investments in the defence subsidiary.

Impact: Positive

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