Brokerages like Kotak Securities, Motilal Oswal, and Prabhudas Lilladadher boost their outlook on Bharat Electronics, citing a robust order pipeline, diversification into new technology sectors, and steady execution amid near-term growth still reliant on major military contracts.
Bharat Electronics has drawn a fresh wave of support from brokerages after a run of earnings updates and order-book disclosures kept sentiment around the defence electronics maker firm. Kotak Securities recently raised its recommendation on the stock to “Add” from “Reduce”, even as it trimmed its target to ₹410 from ₹420, while Motilal Oswal Financial Services kept BEL as its top defence pick and pointed to the company’s strong visibility from a ₹72,000 crore opening order book. Prabhudas Lilladher also turned more constructive, upgrading the shares to “Accumulate” with a target of ₹453, saying the business continues to benefit from steady execution and a healthy pipeline.
The latest broker notes centre on the same broad thesis: BEL’s near-term growth is being underpinned by a long list of military programmes, even if some of the biggest contracts will take time to flow through to revenue. Kotak said missiles are becoming the company’s second major growth engine after electronics, helped by its role in projects such as QRSAM, Pralay, Nirbhay, the long-range land-attack cruise missile programme and Project Kusha. The brokerage expects missile-related revenue to rise to a high-double-digit share of sales over the next two to three years, while also flagging the ₹30,000 crore QRSAM opportunity as the most important catalyst, albeit one that is unlikely to contribute materially before FY2029 because of development and trial work.
Motilal Oswal expects BEL to post 16% year-on-year revenue growth in the September quarter, supported by execution of the large backlog, and has highlighted a number of monitorables including QRSAM, Uttam radars, next-generation corvettes, P75I submarines and the status of the AMCA prototype. The firm also sees margins easing by 170 basis points to 27.7% as the product mix shifts. Prabhudas Lilladher offered a similar reading of the business, saying BEL delivered 11.6% revenue growth in the latest reported quarter, with EBITDA margins at 29.1%, and reiterated that management has held to its FY27 guidance of more than 15% revenue growth and ₹55,000 crore of order inflows.
The broader case for the stock remains tied to order visibility, localisation and the possibility that BEL’s presence in newer technologies will widen its addressable market. Prabhudas Lilladher said the company is expanding into drones, quantum technologies, artificial intelligence-led systems, cyber security, directed-energy weapons and indigenous data centres through work with DRDO, start-ups and academic institutions. It also noted that indigenisation is running at roughly 80% to 85%, exports are becoming more meaningful, and non-defence revenue could rise from 8% to 15% over time. Even so, Kotak cautioned that execution risk and margin normalisation remain real constraints, which explains why analysts remain positive on the stock without treating it as a risk-free bet.
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