Buy Bharat Electronics; target of Rs 360: Motilal Oswal

Motilal Oswal is bullish on Bharat Electronics has recommended buy rating on the stock with a target price of Rs 360 in its research report dated January 30, 2025.

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January 31, 2025 / 21:06 IST

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26 Aug, 2025 12:21

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Motilal Oswal's research report on Bharat Electronics

Bharat Electronics (BHE)’s 3QFY25 results came ahead of our estimates on all parameters. Revenue growth was led by a strong order book, which stood at INR771b.Order inflows stood at INR110b during 9MFY25. As highlighted in our top pick note (Link), we expect BHE to remain a key beneficiary of defense electronics opportunities of large platform orders across the army, navy, and air force. The company expects large order inflows from QRSAM, MRSAM, next-generation corvettes, the defense electronics portion from P75 and P75I, and even Kavach-related orders to materialize in the coming years starting from FY26. We expect the company’s revenue to post a 19% CAGR over FY24-27 driven by improved market share on account of enhanced wallet share as well as improved indigenized offerings. We trim our estimates to bake in lower other income and continue to value the company at 35x two-year forward earnings. We reiterate our BUY rating with an unchanged TP of INR360.

Outlook

We tweak our estimates to account for higher margin estimates and lower other income and maintain our fair value of INR360 on 35x Mar’27E. We reiterate our BUY rating on the stock with an unchanged TP of INR360.

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