According to reports from CNBC TV18, Bharat Forge is investing ₹240 crore in its wholly owned defence subsidiary, Kalyani Strategic Systems Ltd (KSSL). The investment will be made through a rights issue at fair value, following board approval on August 10, 2026. The company will fund this investment through proceeds from its qualified institutional placement (QIP) and internal accruals.
As reported by CNBC TV18, KSSL will use up to ₹163 crore of the investment to fund its own subsidiary, Agneyastra Energetics Ltd (AEL), to establish a state-of-the-art ammunition shell-filling facility. The facility will specialise in pour filling, a process used to fill ammunition shells with explosive material. KSSL will allot equity shares to Bharat Forge on or before October 31, 2026.
According to the regulatory filing disclosed on Friday, KSSL will invest up to ₹163 crore in AEL through a rights issue in one or more tranches, with the investment to be completed by September 30, 2027. The payment will be made in cash, and KSSL will retain its 100% stake in AEL. The proposed investment aims to expand Bharat Forge's defence manufacturing capabilities through its subsidiary KSSL, which focuses on defence and aerospace-related opportunities.
As reported by CNBC TV18, AEL reported no turnover in FY26, according to the filing. The investment comes as Bharat Forge builds its presence in the defence sector through its subsidiary KSSL. The company stated that the proposed investment in AEL would be a related-party transaction conducted on an arm's-length basis, with no government or regulatory approvals required.
According to CNBC TV18, shares of Bharat Forge closed at ₹1,835 on the NSE on Friday, down ₹17.40, or 0.94%. The company emphasised that none of its promoters, promoter group members or group companies had an interest in the investments, ensuring transparency in the related-party transaction structure.
