First Read Bharat Electronics Q1FY27: Steady execution; FY27 guidance intact

Research evidence excerpt

First Read Bharat Electronics Q1FY27: Steady execution; FY27 guidance intact

7 03/26E 8.27 8.29

order pipeline of ~Rs 250bn, includes Shatrughat and Samaghat programs (~Rs 90bn, 03/27E 9.62 9.59

expected over the next 3-6 months), Shakti Phase-IV (~Rs 20bn), the Hammer project 03/28E 11.21 11.27

(~Rs 25bn), NGC/P75 and routine/base orders of ~Rs 100bn. d) Key execution drivers for

Amit Mahawar

FY27 include Akash Army (~Rs 10-12bn), D29 EW, MPR Rudra and BMP-2 upgrade

Analyst

programs (each contributing ~Rs 5-10bn). e) Large platform programs (NGC/QRSAM) amit.mahawar@ubs.com

are expected to begin meaningful deliveries only after around two years. In the interim, +91-22-6155 6030

revenue growth will be supported by the existing order book and smaller base orders

Akshay Gattani

with delivery schedules of 12-18 months. f) Despite increasing private participation in

Astra Mk-2, management expects BHE to remain a key supplier of critical electronic akshay-kumar.gattani@ubs.com

systems and subsystems. +91-22-6155 6044

Harshita Surana

UBS View: Fundamentals intact, maintain BUY Associate Analyst

As earnings upgrades and re-rating have largely played out post Operation Sindoor for harshita.surana@ubs.com

defence SOEs, investor focus is shifting to sustaining execution, order inflows and +91-22-6155 6066

margins amid a high FY26 base. With limited near-term catalysts, re-rating is likely to

remain largely range-bound. We continue to prefer BHE over HNAL, supported by its

proven execution track record and sustained earnings momentum, which in our view

justify a valuation premium. However, rising private participation in large platforms/

emerging segments (as reflected in AMCA, Astra and Netra) might moderately impact