Bharat Electronics Reports Strong H1 FY26 Performance, Reaffirms Growth Targets

Bharat Electronics Limited (BEL), a leading defense electronics company, has reported robust financial results for the first half of fiscal year 2026, demonstrating strong growth across key metrics and reaffirming its ambitious targets for the full year.

Financial Highlights

BEL's performance in H1 FY26 showcased significant improvements across all major financial parameters:

Metric	H1 FY26	H1 FY25	Growth
Revenue from Operations	10,180.00	8,782.00	15.92%
Profit Before Tax	3,023.00	2,488.00	21.50%
Profit After Tax	2,255.00	1,867.00	20.77%
EBITDA Margin	30.15%	27.26%	289 bps
Earnings Per Share	3.09	2.55	21.18%

The company's order book position as of the conference date stood at INR 75,600 crores, with new orders worth INR 14,750 crores acquired during the financial year.

Key Projects and Outlook

BEL's Chairman and Managing Director, Mr. Manoj Jain, highlighted several key projects driving the company's growth:

LRSAM (Long Range Surface to Air Missile) program for the Navy
Himshakti
Battle surveillance system for the Army
Akash Army
LCA Mark 1A avionics modules
Lynx U2 fire control system
Shakti EW (Electronic Warfare) system

The company expects to maintain its growth momentum in the second half of FY26, with major projects including LRSAM, Himshakti, Akash Army, Arudhra MPR radar, D-29 EW system, LCA Mark 1A avionics, and electronic fuses.

Future Projects and Opportunities

BEL is actively pursuing several significant opportunities:

QRSAM (Quick Reaction Surface to Air Missile) System

The company expects to receive the QRSAM order before March, with an estimated value of around INR 30,000 crores. The project is expected to span 5-6 years, with initial production starting after 18-24 months of development.

Emergency Procurement Orders

BEL has received orders worth INR 1,350 crores, with another INR 2,000 crores in the pipeline.

Defense System Integration Complex

The company is investing INR 1,400 crores in a new facility in Andhra Pradesh for manufacturing QRSAM and other strategic systems.

Exports

BEL aims to increase its export revenue to 10% of total turnover in the long term, with a current healthy order book of USD 326 million.

AMCA (Advanced Medium Combat Aircraft)

BEL is part of a consortium bidding for the AMCA program, which represents a significant opportunity for the company to expand its capabilities in aircraft system integration.

Management Commentary

Mr. Manoj Jain reaffirmed the company's guidance for FY26:

Revenue growth of 15% or higher
EBITDA margin of 27% or above
Order inflow of INR 27,000 crores (excluding QRSAM) or INR 57,000 crores (including QRSAM)
R&D investments exceeding INR 1,600 crores
Capital expenditure of over INR 1,000 crores

The management expressed confidence in maintaining a balanced portfolio across Army, Navy, and Air Force segments, each contributing roughly equally to the company's order book and revenue.

Bharat Electronics' strong performance in H1 FY26 and its robust order book position it well for continued growth. The company's focus on diversification, increased exports, and participation in strategic programs like QRSAM and AMCA underscores its commitment to maintaining its leadership in the defense electronics sector.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
-1.69%	+0.39%	+0.46%	+31.67%	+46.10%	+1,301.11%

Bharat Electronics Ltd. (BEL) shares fell 2% to Rs 416.40 on Wednesday, despite the company reporting robust quarterly results that surpassed analyst expectations. The defence public sector undertaking (PSU) posted impressive growth across key financial metrics for the second quarter.

Q2 Financial Highlights

Metric	Q2 FY24	YoY Growth
Net Profit	Rs 1,287.77 crore	26.00%
Revenue	Rs 5,792.09 crore	25.78%
EBITDA	Rs 1,702.17 crore	21.58%

Bharat Electronics' net profit of Rs 1,287.77 crore significantly exceeded analyst estimates of Rs 1,085 crore, showcasing the company's strong financial performance.

Analyst Perspectives

Despite the share price dip, major financial institutions maintain a positive outlook on Bharat Electronics:

Morgan Stanley: Retained a bullish stance, citing BEL's robust order book and strategic shift towards high-margin defence products.
Jefferies: Described the results as an "all-around beat," emphasizing BEL's position as a market leader in domestic defence electronics.

Stock Performance and Analyst Ratings

Year-to-date stock performance: 43.82% gain
Analyst coverage: 32 analysts tracking the company
- 27 analysts have issued "buy" ratings
- Consensus target price implies an 11.2% upside potential

The strong analyst backing and positive financial results contrast with the day's stock performance, presenting an interesting scenario for investors to consider.

Market Implications

The divergence between Bharat Electronics' strong financial performance and its stock price movement on the day of the announcement highlights the complex nature of stock market dynamics. While the company's fundamentals appear robust, short-term market sentiments can sometimes lead to unexpected price fluctuations.

Investors and market watchers may want to closely monitor Bharat Electronics' future performance, particularly its ability to capitalize on its strong order book and maintain its leadership in the defence electronics sector.