Balu Forge Industries Ltd has signed a five-year Memorandum of Understanding for the supply of empty shells for large-calibre ammunition from its greenfield manufacturing facility in Belgaum, Karnataka. The agreement marks an important step in the company’s expansion into the defence consumables sector following its onboarding into the NATO supply chain and the commercial rollout of its empty shell production line.
The MoU covers supply of shells across multiple large-calibre categories, beginning with 155 mm M107 and 152 mm variants, with plans to expand to additional calibres such as 155 mm ERFB/BT, 105 mm, 120 mm and 81 mm in later phases. Under the agreement, Balu Forge will initially supply up to 30,000 units per month of 155 mm M107 shells and 10,000 units per month of 152 mm shells in ready-to-fill condition. Supplies are scheduled to begin in April 2026 and will be ramped up gradually based on production capacity and customer requirements.
To meet the order commitments, the company plans to expand manufacturing capacity beyond its current output through investments funded by internal accruals. Pricing under the agreement will be indexed to the London Metal Exchange to account for fluctuations in raw material costs, with shipments based on FOB Nhava Sheva terms. Payment terms include an advance component with the balance payable through an irrevocable letter of credit.
The agreement has been signed with a NATO-affiliated entity, and the identity of the end user has not been disclosed due to confidentiality provisions. Company officials said the contract supports Balu Forge’s long-term strategy of building a strong presence in defence manufacturing, starting with large-calibre ammunition and expanding into medium- and small-calibre segments over time.
Founded by Prehlad Singh Chandock, Balu Forge Industries Ltd is a precision engineering company manufacturing forged and machined components for global industries. Its integrated operations in Belgaum span forging, machining, tool-making and metallurgical testing across a 46-acre facility.
The company serves sectors including automotive, aerospace, energy, railways, marine, oil and gas and defence. With ongoing investments in research, automation and capacity expansion, Balu Forge aims to strengthen its position in global supply chains while supporting India’s growing defence manufacturing ecosystem through advanced engineering capabilities and high-quality production standards.
