Target: ₹500
CMP: ₹405.75
We remain optimistic on Bharat Electronics (BHE), given its robust order book stands at ₹71,650 crore (3.0x FY25 Revenue). We believe the company’s order inflow will gain traction due to emergency procurement and speeding up the existing projects. supported by marquee upcoming projects such as the ₹30,000 crore plus QRSAM order and the ₹40,000 crore project Kusha.
The company’s diversified pipeline, including NGC subsystems, additional LCA orders, and critical defense systems like LRSAM & radar solutions, positions it well for sustained revenue growth and market leadership.
We have introduced FY28E estimates and, based on the average FY27/28E EPS, revised our target price to ₹500 (earlier ₹420), valuing the stock at 40x, while maintaining our ‘Buy’ rating. The revision reflects our continued confidence in BHE’s long-term growth visibility and strong execution capabilities.
Additionally, BHE is well placed within the defense sector, because BHE not solely reliant on order inflows from major DPSUs. Its diversified portfolio, strong R&D capabilities, and increasing presence in both defence and non-defence sectors enhance its long-term growth potential. The company’s ability to secure independent contracts from other DPSUs and expand into new technological domains like AI, cybersecurity, further strengthens its investment appeal.