Buy Bharat Electronics; target of Rs 210 Sharekhan

Sharekhan's research report on Bharat Electronics

Recently, BEL received orders worth ~Rs. 8,801 crore, which helped the company in exceeding management’s order intake guidance of Rs. 20,000 crore, which gives strong growth visibility for FY2024 and beyond. Higher spending on defence by the government over the next few years with a focus on indigenisation will help company in maintaining growth momentum. New non-defence products will help the company diversify its revenue. Further, any breakthrough on the exports front could be a key growth catalyst.

Outlook

We expect Revenue/PAT CAGR of ~15% each over FY2023-FY2026E along with a high RoE/RoCE of 22%/21% in FY2026E. We retain Buy with a revised PT of Rs. 210.

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