Bharat Dynamics Ltd. share price target

Bharat Dynamics’ (BDL) results were weaker than our estimates, with execution impacted by delays in the supply of radars, seekers, and other components for Akash and Astra Mk1 missiles from external vendors.

Bharat Dynamics (BDL)’s 3QFY26 performance was weaker than our expectations. Execution was impacted due to delays in component integration from other vendors, while margin was hit by lower revenue and a higher share of bought-out components for Akash and Astra Mk-1.

BDL’s Q2FY26 performance beat consensus expectation as EBITDA grew 90% YoY driven by strong sales (+114% YoY). EBITDA margin fell 180bps YoY to 16.3%, implying an adverse product mix (gross margin was lower) and potentially higher R&D expenses (other expenses were higher).

Bharat Dynamics (BDL) delivered a strong performance in 2QFY26 as supply chain issues started easing out, resulting in a sharp execution ramp-up. However, margins were affected by project mix during the quarter.

Bharat Dynamics (BDL) is a prominent player in missile technology within the defense sector and has established itself as a leading integrator for various missile platforms.

Healthy order book of INR 22,700 Cr. (Apr’25) translating into 6.8x order book / FY25 sales (highest amongst peers), strategic importance to GoI (prime production agency for guided weapons systems) and expected improvement in operating margins.

Bharat Dynamics (BDL) reported a healthy Q3FY25 performance. EBITDA (adj. for provisions created) sored 120% YoY to INR 2.6bn while revenue surged 34% YoY to INR 7.9bn.

Bharat Dynamics’ (BDL) Q2FY24 performance was resilient led by pick-up in execution. Key points: 1) In our view, profitability was aided by execution of ATGMs – most of which have high indigenous content; 2) revenue growth was partially aided by making up of some shortfall in FY23; and 3) other income was aided by customer advances received post ordering of Akash 3rd and 4th regiment.

Bharat Dynamics (BDL) reported loss at the EBITDA level in Q1FY24. Key points: 1) revenue was down 57% YoY as the quarter did not have certain deadline-specific orders it had last year ; 2) fixed costs remained broadly stable; 3) other income surged on the back of advances (mainly for Akash 3rd and 4th regiments); and 4) orderbook as of 30th Jun’23 was at INR 202.2bn, implying orderbook/revenue (ttm) of 9.7x.

We hosted the Bharat Dynamics (BDL) management for a meeting with investors on 13th Jun’23. Key points: 1) orders pertaining to several defence programmes are expected post FY25 in association with DRDO, BDL’s own R&D and collaboration with foreign players; 2) company is ready for QRSAM production as limited validation trials got over in Apr’23.

We perceive the knee-jerk reaction to Bharat Dynamics’ (BDL) stock post its Q4FY23 result as an opportunity to BUY, as the company has robust orderbook and execution is picking up. BDL’s Q4FY23 EBITDA missed our estimate by 14%.

Bharat Dynamics’ (BDL) Q3FY23 EBITDA was down 69% YoY (5% QoQ) at Rs889mn. Key highlights: i) EBITDA margin expanded to 19.3% in Q3FY23 (Q2FY23: 17.5%) and gross margin too remained healthy at 69.8%. ii) Higher R&D expenses in light of future opportunities resulted in spurt in ‘other expenses’.

Bharat Dynamics’ (BDL) Q2FY23 EBITDA was up 42% YoY (123% QoQ) at Rs939mn. Key highlights: i) EBITDA margin expanded to 17.5% in Q2FY23 (Q2FY22: 13.1%; Q1FY23: 6%) and gross margin too remained healthy at 55.4%.

Bharat Dynamics (BDL) has reported lower-than-expected earnings in Q1FY23 with ~50% QoQ decline in revenue and ~85% QoQ decline in PAT.