Bharat Electronics Limited is an Indian company which is primarily engaged in the business of providing defence electronic products for the Indian Armed Forces. The company also exports its products and services to other countries.
The market capitalisation of Bharat Electronics Limited, as of early July 2018, is a little over Rs.27,200 crore.
Company’s Wealth and Recent Performance
- For the fourth quarter of the financial year 2017-18, the company’s revenue from operations was reported to be at Rs.3,427.9 crore. In comparison to the corresponding period last year, this is a sizable reduction in income from Rs.4,074.2 crore.
- However, for the year ended on March 31, 2018, the company’s total income has shown a considerable increase over the previous year. The total income at the end of the year was stated to be at Rs.10,601 crore as against Rs.9,611.4 crore for the FY 2016-17.
- The total profit for the March quarter was stated to be at Rs.587.65 crore. For the entire year, the profit was Rs.1,399.2 crore as against Rs.1,547.6 crore reported for the previous year. The reduction in profit despite a decent increase in revenues came on the account of greater expenses for this fiscal year. The company’s total expenses for the year stood at Rs.8,653.1 crore as against Rs.7,582.03 crore.
- The earnings per share for the fiscal year 2017-18 was Rs.5.70 as against Rs.6.03 reported for the last year. The company’s order book as of April 1, 2018, stands at around Rs.40,000 crore. The company is expected to grow in the coming year on the back of a healthy order book and products in the pipeline.
Bharat Electronics Limited Stock Trends in 2018
- On January 2, 2018, the opening price of Bharat Electronics Limited shares was Rs.182.50. The scrip has been incredibly bearish since the start of the year. Over the first three weeks of January, the BEL share price dipped marginally by around 4% to touch the Rs.175 mark. The scrip ended the month at Rs.169.35 on the NSE.
- In early February, Bharat Electronics Limited made an announcement regarding buyback of shares. This, coupled with rocky conditions in the international markets, took the BEL share price down by a considerable margin. By the end of the first week of February, the share price was down by more than 15% and the Bharat Electronics shares were changing hands at levels around Rs.140 - Rs.150. An interim dividend of 160% was also announced in the same month.
- The share price of Bharat Electronics continued to fall further as the scrip ended the month at Rs.151.35. The month of March witnessed a gradual decline in the stock price with the closing price on March 31, 2018 being Rs.141.45. The price dipped further in April despite the company unveiling new products at the Defence Expo 2018. The Bharat Electronics stock price went down by another 6% in the month to close at Rs.131.20.
- The month of May didn’t bring any relief to the investors. The shares continued to go through their rocky ordeal as they shed another 10% in the month. A similar tale was seen in the month of June as well with the stock now inching closer to the Rs.100 mark. In fact, towards the end of the month, the shares reached their new 52-week low at Rs.101.30.
Bharat Electronics Limited Stock Trends in 2016 and 2017
- At the start of 2016, the Bharat Electronics share price was varying at levels slightly above Rs.125. The first half of the month saw the price drop by a little under 10%. This dip was seen through the next couple of weeks as well with the scrip eventually descending into the Rs.100 region. The prices didn’t recover until the final week of March with the scrip ending the month at Rs.111.30. An interim dividend of 25% was also announced in early February.
- The month of April and May witnessed a gradual decrease in the share price. While this decline wasn’t that sharp and even that significant, the investors still moved on to lose a little over 5% in their shares. The closing price of Bharat Electronics share on May 31, 2016 was Rs.107.11. The prices bounced back in the first week of June and the scrip ascended back to its previous levels at Rs.116.
- Through most of July and August, the BEL shares managed to retain their bearings at levels above Rs.110. While the prices did vary during intraday sessions in this period, the gains and losses made in this period were rather minimal. A final dividend of 145% was announced in the second half of August and the closing price at the end of the month was Rs.110.95.
- In the final few months of the year, the stock prices recovered slightly to end the year on a positive note. The BEL shares rose cautiously through September and October to touch the Rs.120 mark again. In the final week of November, the share price spiked to touch the Rs.130 mark but the shares failed to sustain at those levels. The closing price at the end of the year was Rs.125 on the NSE.
- 2017 started on a bright note for the investors. The markets were positive owing to the new year and as a result, the Bharat Electronics share price rose handsomely through the month. The scrip moved up by more than 10% and its closing price on January 31, 2017 was Rs.140. An interim dividend of 30% was announced in February and the price stayed steady at levels above Rs.135.
- The share price rose slightly in March to end the month at Rs.142.50. In this period, an interim dividend of 90% was announced in addition to shares split. The first week of April witnessed a meteoric rise in the BEL share price which took the scrip beyond the Rs.150 mark. Through the second half of April and early May, the shares stabilised at levels above Rs.160.
- The prices dipped marginally in the final week of May but BEL shares still managed to hold steady at levels above Rs.150. A similar trend was observed in the month of June as well. In early July, the prices dipped slightly to go below the Rs.150 mark but soon followed it with a good recovery. The price rose again to reach their previous highs at Rs.160 towards the end of July.
- A final dividend of 105% was announced in mid-August. This announcement was immediately followed by a sharp rise in the share price of Bharat Electronics Limited. By mid-September, the share price had touched the Rs.180 mark although, it failed to sustain at those levels.
- At the end of September, the company announced bonus shares in 10:1 ratio. The announcement drove the stock price up to such an extent that Bharat Electronic scrip gradually reached its new 52-week high at Rs.193.40. The closing price at the end of the year was Rs.182.15.
Should you invest in Bharat Electronics Limited Stock?
- Bharat Electronics Limited is a defence public sector undertaking that, along with Hindustan Aeronautics Limited, contributes heavily to the requirements of the Indian Armed Forces. BEL primarily contributes by supplying electronic equipment.
- As a Navratna company, Bharat Electronics Limited has done well to establish its dominance in the sector. Its order book is currently valued at Rs.40,000 crore - four times more than its income from operations. However, the company is quite slow in executing the orders and as a result, its financial performance may be able to reflect that only later.
- For the present fiscal year, the company’s revenue grew by 20%, reporting excellent numbers. However, its profit for the year dipped by Rs.148 crore to stand at Rs.1,399.29 crore. The company has various products in the pipeline and considering its order book, BEL is placed well to grow in the near future.
- The company has started to outsource its orders which may result in a reduction in execution time. Bharat Electronics Limited is also going to set up two new plants in India to boost its capability. Furthermore, in a bid to boost exports, the company is also planning to set up marketing offices outside India.
- Needless to mention, the future of the company is bright. It is poised for strong growth and as an investor, patience is the key here. The company’s stock was bullish for quite some time and the scrip delivered returns of more than 50% between 2016-2018. However, the start of 2018 marked the start of a bear run which has resulted in severe losses for investors. However, for many, this presents an attractive opportunity to enter the market. It is strongly recommended that you research thoroughly before investing in this stock.
Bharat Electronics Limited is a Navratna Company owned by the Government of India and managed by the Ministry of Defence. The organisation plays a critical role in meeting the electronic requirements of the Indian Armed Services. It produces high-tech equipment equipped with the latest technology like radars, weapon systems, telecom & broadcast systems, electro-optics, solar-photovoltaic systems, et cetera. Presently, the company has eight manufacturing units in India and two overseas office.
History of the Company
The roots of the company can be traced back to the year 1954, when Bharat Electronics Limited was one of the few public sector undertakings that were formed to develop the economy of the newly independent India. The company started its operations with the manufacture of communication equipment in 1956 and followed it with the production of receiving valves, semiconductors, and radio transmitters. The 70s and 80s saw the company expand its operations by setting up various manufacturing units in the country. The company’s equity shares were listed on the stock exchanges in 1992. Over the years, the company has grown to become one of the most important contributors to the Indian Defence Services.
Management of the Company
Mr. M.V Gowtama - Chairman & Managing Director
Mr. Gowtama presently serves as the Chairman, Managing Director, and Whole-time Director at Bharat Electronics Limited. Prior to this appointment to the post, he worked as the General Manager of the Bangalore Unit at BEL. He joined the company back in 1983 as a Probationary Officer. Over his massive tenure, he has worked on a variety of projects. He finished his B.Tech in Electronics and Communication from Sri Venkateswara University College of Engineering, Tirupati and M.Tech in Advanced Electronics from Jawaharlal Nehru Technological University, Hyderabad.
Mr. Koshy Alexander - Director of Finance
Mr. Alexander presently serves as the Director of Finance at Bharat Electronics Limited. In addition to this, he also serves as its Executive Director/Whole-time Director. Prior to his appointment to his post, he worked in the organisation as General Manager of Finance. He finished his B.Com from Bangalore University and followed it with a postgraduate degree in Commerce. He is also a Chartered Accountant.
Mrs. Anandi Ramalingam - Director of Marketing and Whole-time Director
Mrs. Anandi Ramalingam currently serves as the Director of Marketing at Bharat Electronics Limited. Prior to this, she served as the General Manager of Bangalore Unit. She joined the organisation in 1985. Over the course of the last 20 years or so, she has worked on various projects. She has also been honoured with the Raksha Mantri Award for her service and dedication. She has also played an important role in setting up the Marketing Division for the Military Communication & Electronic Warfare SBU at Bangalore Complex. She also worked in the International Marketing Division and played a crucial part in making BEL a global supply chain partner and facilitating the growth of the company’s order book.
Bharat Electronics Limited Listings in NSE, BSE, and Indices
The equity shares of the company are available for trading on the following stock exchanges:
- The National Stock Exchange of India Limited
- The Stock Exchange, Mumbai
Being one of the major players in the defence sector, Bharat Electronics Limited comprises the following indices:
- NIFTY 100
- NIFTY 200
- NIFTY 500
- NIFTY PSE
- NIFTY Next 50
- S&P BSE 100
- S&P BSE 200
- S&P BSE 500
- S&P BSE AllCap
- S&P BSE Industrials
Bharat Electronics Limited
Outer Ring Road, Nagawara
Bangalore - 560045
Contact number: +91-80-25039300
Stocks vs. Mutual Funds: here's what we recommend
Stock market investments require a lot of research and knowledge. They do not generally offer any tax benefits and are regarded as high-risk investments. Hence,it is crucial to have a diversified portfolio. At Bankbazaar, we encourage our readers to invest on mutual funds.It doesn't require a lot of knowledge and equity linked mutual fund schemes offer tax benefits. Additionally, since mutual funds comprise stocks from multiple companies, they help in building a diversified portfolio.DISCLAIMER:
The contents of this post/blog does not constitute financial or other professional advice nor does it imply in any manner a principal-agent relationship, and is not a professional advice on a specific financial matter.