Bharat Dynamics (BDL), a Mini-Ratna PSU under the Ministry of Defence, has bagged a massive INR 4,362.23 crore order from the Indian Armed Forces. The contract is for the supply of sophisticated armaments and will significantly enhance the country’s indigenous defence capabilities.
The announcement triggered an immediate rally in BDL shares, which went up to 4% intraday and touched a high of INR 1,357.70 on NSE. The stock has been on a steady upmove since March 3 and has risen 48% from its low of INR 907 in just three weeks.
Strategic Significance of the Order
As per the exchange filing, the order was given by the Indian Armed Forces, and the terms are confidential in the interest of national security. The execution timeline is also not disclosed. However, the size of the deal indicates renewed momentum in defence procurement after the Defence Acquisition Council’s approval of INR 54,000 crore worth of capital acquisition proposals to modernise the military.
This is a big thumbs up to the government’s “Atmanirbhar Bharat” initiative, with BDL being a key player in India’s missile manufacturing ecosystem.
Bharat Dynamics Post-IPO Performance
Bharat Dynamics launched its IPO on 13 March 2018. The IPO was a total offer for sale, and the issue size was INR 960.94 crore. BDL IPO was subscribed 128% and listed with a loss of 6.65%.
However, BDL’s post-IPO performance was stellar, reaching an all-time high of INR 1,794.70 per share, reflecting a multibagger return of 319% from its allotment price of INR 428 per share. Currently, the BDL share has received a correction of 28% from its highest peak and is trading around INR 1,289 per share.
Last month, BDL gave more than 30% returns and has outperformed broader market indices. Even in market corrections, the stock has held up well, which is an indication of long-term institutional confidence in its fundamentals.
Brokerage Outlook: Bullish Bias Maintained
Of the eight analysts covering the stock, four have a Buy rating, three have a Hold, and one has a Sell. Brokers like ICICI Securities and Antique Stock Broking have target prices of INR 1,351-1,400, citing robust order visibility, government support and operational efficiencies.
BDL Q3 FY25 Performance
BDL reported a 9% YoY growth in net profit to INR 147.12 crore in the December 2024 quarter. Revenues grew 38% YoY to INR 832.13 crore due to strong execution and order inflow. However, EBITDA margins contracted to 15.3% from 19.8% YoY due to input cost pressures and operational ramp-up.
As of December 2024, the Government of India holds 74.93% stake in the company.
Conclusion
BDL’s latest big order not only strengthens its financial and operational outlook but also reinforces India’s commitment to self-reliant defence manufacturing. With the government showing a clear bias towards domestic procurement and private sector participation increasing, Bharat Dynamics is well placed to capitalize on India’s decade-long defence capex cycle.
For long-term investors looking to invest in India’s defence sector, Bharat Dynamics is a high-conviction stock with strategic tailwinds and strong earnings visibility.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors are advised to conduct their own research or consult financial advisors before making investment decisions.