Target: ₹360
CMP: ₹318
Bharat Electronics (BEL) reported numbers above expectation, with revenue growing 19.6 per cent y-o-y to ₹4,200 crore and EBITDA margins expanding 340 bps y-o-y. Order book as on Q1-FY25 stands strong at ₹76,700 crore (3.7x TTM sales). Order pipeline continues to remain robust for the next couple of years, driven by government focus on product localisation and increasing government capex on defence sector.
BEL expects to bag orders worth ₹25,000 crore, in FY25. QRSAM (project worth ₹25,000 crore) all trials are completed successfully and orders are expect to be placed in FY26. Order pipeline for FY26 stands at ₹50,000 crore (including QRSAM order).
The management reaffirmed its revenue guidance of 15 per cent growth for FY25; with EIBTDA margins of 23-25 per cent. BEL will continue to explore new growth opportunities through export initiatives, diversification, capability enhancement, competitiveness and modernisation. Capex planned for FY25 stands at ₹800 crore.
We remain positive on BEL given strong order backlog, strong revenue visibility, sustained steady margin profile, healthy order prospects, continuous focus on diversification and exports markets and continued indigenisation push by the government of India.
