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UBS Upgrades Bharat Electronics, Sets ₹450 Target on Strong Growth Prospects

The investment bank cites accelerated order pipeline, robust margins, and competitive edge as reasons for preferring BEL over HAL.

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Overview

  • UBS has raised Bharat Electronics Ltd.'s rating to 'buy' from 'neutral' and increased its target price to ₹450, implying a 17% upside from the last close.
  • BEL's order book is expected to grow significantly, with UBS projecting a 17% annual increase for FY25-28, driven by faster revenue conversion from a ₹2.4 lakh crore long-term pipeline.
  • The company reaffirmed its FY26 guidance, targeting ₹55,000 crore in new orders, at least 15% revenue growth, and a 27% EBITDA margin, supported by ₹1,000 crore in capex and ₹1,600 crore in R&D spending.
  • BEL's combat-proven platforms, including Akash missile systems and advanced radars, bolster its competitive positioning for domestic and export orders.
  • Shares closed slightly higher at ₹383.35 on Thursday, with 24 of 28 analysts maintaining a 'buy' rating, reflecting strong investor confidence in the company's growth trajectory.