Shares of Bharat Dynamics surged 4 percent to Rs 1,550 on August 13 after the company posted a strong performance for the June quarter (Q1 FY26). Brokerages have maintained a bullish stance on the defence PSU, projecting up to 50 percent upside from current levels, saying its valuations are reasonable.
Since the start of this year, the stock has rallied more than 30 percent, comfortably outperforming the Nifty 50’s 2 percent gain during the same period.
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Motilal Oswal analysts have upgraded Bharat Dynamics to buy from neutral with a target price of Rs 1,900 per share. They noted that the company achieved a robust 30 percent year-on-year growth in execution in Q1 FY26, supported by a strong order book and easing supply chain bottlenecks compared to last year.
“With an order book of nearly Rs 23,300 crore, we expect execution to gather pace in the coming quarters, particularly in the Akash, Astra Mk1, MRSAM, and armament projects. BDL is also likely to benefit from a strong project pipeline of nearly Rs 50,000 crore and ongoing emergency procurement programmes,” they said.
They added that with the stock price having corrected 25 percent, valuations are now attractive at 39x FY27E EPS and 29x FY28E EPS. They expect execution and margins to improve further in the coming quarters.
Nuvama Institutional Equities has also retained its buy rating on the stock, setting a higher target price of Rs 2,250 per share. The brokerage expects Bharat Dynamics to deliver a 51 percent revenue CAGR and a 66 percent EPS CAGR over FY25–28E. They also project operating margins in the range of 23–23.5 percent, aided by easing import-related supply constraints.
In Q1 FY26, Bharat Dynamics reported a massive 154.37 percent year-on-year jump in net profit, which came in at Rs 18.34 crore compared to Rs 7.21 crore in the same quarter last year. Revenue from operations grew 29.69 percent to Rs 247.92 crore from Rs 191.16 crore in the year-ago period, while total expenses rose to Rs 311.65 crore.
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