Accumulate Bharat Electronics; target of Rs 143: Prabhudas Lilladher

Prabhudas Lilladher recommended accumulate rating on Bharat Electronicss with a target price of Rs 143 in its research report dated October 31, 2023.

Broker Research

November 06, 2023 / 11:26 IST

Accumulate

26 Aug, 2025 12:21

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Todays L/H

Prabhudas Lilladher's research report on Bharat Electronics

Bharat Electronics (BEL) reported mixed quarterly performance with revenue growth of 1.2% YoY and EBITDA margins expanding 346bps YoY to 25.2%. Revenues were partly impacted due to spillover of executions worth Rs4bn to H2FY24. H1FY24 order inflows came in strong at ~Rs154bn, giving confidence to achieve its FY24 inflow guidance of Rs200bn+. Tender Pipeline for next 12 months comprises of 1) equipment’s for shipbuilding programs with CSL & GRSE (Rs25bn) 2) Electronic warfare system (Rs20bn) and 3) tank upgrade programme (Rs30bn). H1FY24 exports revenue stood at US$27mn, management targets for US$90mn for FY24. Management maintained its FY24 revenue growth guidance of 15-17% and EBITDA margin of 21-23%. We remain positive on long-term growth story of BEL given 1) strong order backlog & order pipeline 2) diversification in newer business verticals like, hydrogen fuel cell, EV batteries etc., 3) focus on export markets (Egypt, Malaysia etc.) and 4) govt’s focus on product indigenization.

Outlook

The stock is currently trading at PE of 28.8x/24.2x/20.9 FY24/25E26E. We roll forward to Sep’25 number and maintain Accumulate rating on stock with TP of Rs143 (Rs140 earlier), valuing it at PE on 24x Sep’25E (25x FY25 earlier).

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