Bharat Electronics shares fell ahead of its second-quarter results as investors weighed expected revenue growth against margin trends and uncertainty over major defence contracts, including the proposed ₹300 billion QRSAM order.
Bharat Electronics Ltd fell in early trade on Friday as investors positioned themselves ahead of the state-owned defence electronics maker’s second-quarter results. The stock dropped as much as 2.27% to ₹363.55 on the Bombay Stock Exchange, underscoring market caution even as the company heads into an earnings update that is expected to show another quarter of solid growth.
Analysts expect the company to post roughly 16% year-on-year revenue growth for the quarter, broadly in line with its fiscal 2027 guidance. Kotak Institutional Equities said earnings before interest, tax, depreciation and amortisation margin could improve by 390 basis points from the previous quarter to 28.9%, helped by stronger gross margins. The brokerage said investors will be watching closely for progress on the proposed ₹300 billion QRSAM order, which is still awaiting approval from the Cabinet Committee on Security, especially after year-to-date order inflows of ₹7,300 crore fell 44% from a year earlier.
Motilal Oswal Financial Services also expects revenue to rise 16% from a year earlier, supported by execution of an opening order book worth ₹72,000 crore. It sees profit rising 9% to ₹1,403 crore, but warned that margins may ease to 27.7% from a year earlier because of a changing product mix. The brokerage said the most important updates will be on large-ticket contracts including QRSAM, Uttam radars, next-generation corvettes and P75I submarines, as well as the status of the AMCA prototype.
Nuvama expects a more modest 13% increase in execution, but said the company’s backlog should keep revenue visibility healthy over the medium term. It also said margins are likely to remain structurally strong at about 28%, supported by operating efficiencies and greater localisation. The stock has been sensitive to margin trends before: after a strong topline in a previous quarter, shares still fell when profitability came under pressure, highlighting how closely the market watches execution quality as well as sales growth.
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