resr 5paisa Research Team 7th September 2023

This large cap defence stock has trebled the investment amount in just 2 years

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The company’s board is scheduled to meet on August 4 to announce bonus issue to equity share holders. 

Shareholders of Bharat Electronics are in for double bonanza as the company has not only given blockbuster returns but is also considering issue of bonus shares. Also, in last one month the shares of BEL has rallied 25% on the back of a strong Q1 financial numbers and robust order pipeline.

As against BEL’s stellar performance on the bourses gaining 54% in last 1 year and 196% in last 2 years, the benchmark index Sensex has delivered 11% in 1 year and 55% in 2 years.

Bharat Electronics (BEL) is a leading aerospace and defence electronics company. It primarily manufactures advance electronics products.

The company has delivered strong Q1FY23 results on the back of healthy order book, however margins were impacted owing to semiconductor shortage and escalating raw material prices.

For the quarter ended June 2022, revenue jumped YoY by 96% at Rs 3087.28 crore due to a lower base (Q1FY22 was affected by Pandemic induced Lockdown). However, on a QoQ basis, it was down by 50.3%.

EBIDTA and PAT rose exponentially by 646% and 2629%, YoY at Rs 522.37 crore and Rs 356.13 crore, respectively. Sequentially, both EBITDA and PAT were down by 70%. The company reported an EBITDA margin of 16.63% for the quarter ended March 2022, while PAT margins stood at 11.34%.

The company has total order backlog for the company stood at Rs 55,333 crore. The management has guided a minimum of Rs 20,000 crore order inflows are expected in FY23. Opportunity size from exports stands high due to government focus on increasing defence exports. The export order book was at $272 million, while expected inflows are projected at $60 million.  

At 11.45 am, shares of BEL are quoting Rs 284.10 with a gain of Rs 1.35 or 0.48% per share. The shares of BEL have logged a 52-week high and low of Rs 287.75 and Rs 162.40, respectively. 

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