Bharat Forge expects deliveries of 184 Advanced Towed Artillery Gun Systems (ATAGS) ordered by the Indian Army to begin in the first quarter of FY28, following receipt of the long-awaited production approval. The company clarified that the order itself had not been deferred and that the delay was limited to the production clearance process, which shifted the programme’s revenue recognition into FY28. Management said ATAGS deliveries are not a prerequisite for the company’s near-term growth, as several defence contracts secured over the past six to twelve months, including engineering procurement projects, are expected to start contributing in the second half of FY27. Bharat Forge remains confident in its growth outlook, supported by a diversified portfolio spanning aerospace, industrial exports, semiconductor-related opportunities, commercial and passenger vehicle export programmes, marine projects, JSA and K-Drive initiatives. The company expects business momentum to strengthen during the second half of FY27. Deliveries under the ATAGS contract are expected to be spread over approximately four years, with the initial year focused largely on production ramp-up and deployment, followed by more stable delivery rates in the second and third years. Management outlined an indicative schedule starting at around 10% of the order volume, increasing to approximately 15% and then 20%, with subsequent years accounting for similar volumes before the remaining balance is completed. However, the actual schedule will depend on the Indian Army’s absorption and induction plans rather than manufacturing capacity alone. Battalion-level training and operational integration of the new artillery systems will influence acceptance and deployment timelines. Bharat Forge said its manufacturing infrastructure can produce approximately 120 to 150 large artillery guns annually across mounted, wheeled and towed configurations, making the 184-gun ATAGS order only part of its overall production potential. The programme is expected to generate margins of around 20% to 22%, supported by strong asset turnover. More broadly, defence business margins are projected to range between 20% and 25%, depending on product mix, with current margins expected to remain around 20% to 21%. Management anticipates an improvement of at least 200 to 300 basis points as the portfolio shifts towards more sophisticated systems and fully filled ammunition solutions. ATAGS is a major indigenous artillery programme featuring a 155mm/52-calibre gun, designed to provide extended range, advanced automation and improved firepower compared with legacy artillery systems, supporting India’s wider defence self-reliance objectives.
