Mehta Equities has come out with its report on Bharat Dynamics IPO , The research firm has recommended to “ Subscribe ” the IPO in its research report as on March 10, 2018
Bharat Dynamics Ltd (BDL) is a five decade old wholly owned Government of India company with its headquarter in Hyderabad. BDL is sole PSU in India which is engaged in the manufacture of Surface to Air Missiles(SAMs), Anti Tank Guided Missiles(ATGM), underwater weapons, launchers and test equipment. BDL supplies its products to Indian armed forces. BDL is also engaged in the business of refurbishment and life extension of missiles manufactured. Additionally BDL is a co-development partner with DRDO for next generation of ATGM and SAM. BDL has currently set up three manufacturing facilities located in Hyderabad, Bhanur and Vishakhapatnam.
This is first of its kind offer to public to own a GOI owned defense Sector Company which is the sole manufacturer in India for SAMs, torpedoes and ATGMs to the Indian armed forces. We believe BDL will take full benefits of Make in India’ initiative which inline will boost investor confidence to invest. Company is keen to demonstrate its potential for India's requirements but also see potential to export. On valuation parse BDL is available at fully diluted equity price to earnings ratio near 22x FY2018 which seems to be fully priced but we expect it could attract good attention as being the first of its kind. Hence considering all the above parameters we are optimistic on the business growth and recommend investors to subscribe to the IPO for long term investment.
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