On Tuesday, Phillip Securities initiated coverage on Bharat Electronics (NS:BAJE) Ltd (BHE:IN) with a Buy rating and a price target of INR390.00. Bharat Electronics, a key player in the defence electronics sector, has been recognized for its significant role in supplying essential components for weaponry.
The firm's analyst cited several factors contributing to the positive outlook for Bharat Electronics. The company's dedication to research and development, coupled with its continuous introduction of new products, positions it to benefit from the Indian government's push for indigenisation and the modernisation of the armed forces.
Despite near-term concerns regarding profit margins, the analyst pointed out that Bharat Electronics has a robust order backlog and a strong order pipeline. Additionally, the company's strategic focus on service provision, non-defence segments, and export markets further solidifies its financial prospects.
The Buy rating is supported by the company's potential growth, with the analyst projecting a target price based on 40 times the estimated earnings per share (EPS) for December 2026. This valuation reflects the firm's confidence in Bharat Electronics' long-term earnings capacity and market position.
The initiation of coverage by Phillip Securities with a favorable rating underscores the positive market expectations for Bharat Electronics, as the company continues to innovate and expand its offerings in the defence electronics space.
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