Bharat Dynamics shares extend rally to third day, jumps 5% to hit one-month high

Over the past three months, Bharat Dynamics' stock has gained 18 percent

Shares of Bharat Dynamics climbed 5 percent to Rs 1,345 on January 20, marking a 1-month high and extending their winning streak to three sessions. The stock has surged 18 percent over the past three days, driven by strong order momentum.

The company recently signed a Rs 2,960 crore contract with the Defence Ministry to supply Medium-Range Surface-to-Air Missiles (MRSAM) for the Indian Navy. The MRSAM system is a standard feature on multiple Indian Naval Ships and is planned to be installed on most future platforms.

This contract boosts India’s defense capabilities and advances military indigenisation. With this deal, the company’s year-to-date FY25 order intake has risen to Rs 3,110 crore, nearly doubling from Rs 1,793 crore in FY24.

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Analysts at ICICI Securities believe order execution will remain a critical factor, as the company faced supply chain disruptions that led to a 19 percent year-on-year decline in H1 FY25 revenue. CRISIL Ratings expects Bharat Dynamics' revenue to grow by 28 percent to 30 percent in FY25 and 13 percent to 15 percent annually in the medium term, supported by a robust order book and improved execution rates.

Meanwhile, brokerage firm Elara Securities suggests that Bharat Dynamics has resolved its supply chain issues by indigenising missile components previously imported from Russia. It anticipates a pickup in orders in Q4 FY25 as defense inflows increase.

Over the past three months, Bharat Dynamics' stock has gained 18 percent, significantly outperforming the Nifty 50 index, which declined 6 percent. The stock had earlier reached a 52-week high of Rs 1,794 on July 5, 2024.