2:1 Bonus Issue: Multibagger Bharat Electronics To Mull Dividend On March 15, Buy For TP Rs 257: UBS

Leading foreign brokerage firm UBS has upgraded target price of Navratna Multibagger PSU Bharat Electronics Ltd shares (BEL) and assigned buy call. The global brokerage firm has assigned new target price of Rs 257 apiece from the previous Rs 205 per share amid rise in financial year 2024 orders. Current market price of Bharat Electronics share on BSE is Rs 190.00 with intraday fall of 7.02%. If you buy Bharat Electronics stock now, you can fetch potential gain of 35.26%.

BEL shares offered stunning return of 105% in last 1-year and soared 307% in last 3-years. Meanwhile, Board of Directors of BEL are scheduled to hold a meeting on March 15, 2024 to consider its 2nd interim dividend. BEL has a market capitalisation of Rs 1,38,885.80 crore. Check details below:

UBS Valuation On Bharat Electronics: According to the analyst, ""We raise our target price to Rs 257 and maintain Buy, assigning a 35 times PE to March 2026 earnings (against 30 per cent earlier), building in a lower 10 per cent discount to industrial peers (against 25 per cent 10-year average), given better earnings/new orders momentum."

"Lastly, share of nomination business (where Bharat Electronics is assured fixed cost plus markup), which still accounts for a major share of BEL's revenues, remains crucial for its margin trajectory," added the analyst.

Slower order book accretion became a vital worry for investors over the past two years. In its view, accretion (excess in orders booked over sales) of Rs 10,000 crore-plus in FY24E paves the way for an upward revision in top line against consensus estimates of 14% revenue growth each in FY25 and FY26, stated UBS.

Bharat Electronics To Consider 2nd Interim Dividend On March 15: As per the regulatory filing of the company dated March 7, 2024, "Pursuant to Regulation 29 of the SEBI(LODR) Regulations, 2015, we wish to inform that a meeting of the Board of Directors of the Company is scheduled to be held on Friday, the 15fh March, 2024 to consider, inter alia, declaration of second interim dividend for the financial year 2023-24."

Bharat Electronics Shares Performance & Return: The 52-week high price of Bharat Electronics shares on BSE is Rs 216.70 apiece and 52-week low price is Rs 89.68 apiece, respectively. BEL has a ROE of 24.75 and PE of 41.47. Its EPS (TTM) is 4.93. BEL stock offered rally of 40% in last 6-months, surged 166% in last 2-years, and rose 510% return in last 5-years. Bharat Electronics shares gained massive 1788% in last 10-years.

Earlier this year on February 21, the PSU stated credit rating agency ICRA reaffirmed the its long-term rating at '[ICRA] AAA' with stable 'outlook'. ICRA also affirmed the company's short-term rating at ICRA] A1+.

Bharat Electronics Financials: BEL declared its net profit for the quarter ended December 31, 2023 at Rs 859.6 crore, up 40% as against Rs 613 crore announced in the similar quarter of last year. BEL's revenue remained nearly flat at Rs 4162.2 crore as against Rs 4153 crore in the corresponding quarter of last year. EBITDA of BEL announced at Rs 1072.6 crore, up 24% as against Rs 863.4 crore in the same quarter of preceding fiscal. Meanwhile, margin arrived at 26%.

BEL Dividend History: BEL announced 49 dividends since August 27, 2001. In the last 12 months, Bharat Electronics announced an equity dividend amounting to Rs 1.90 per share. At the current share price of Rs 190.00, Bharat Electronics offers dividend yield at 1.00%.

BEL Bonus Share History: The last bonus that Bharat Electronics declared was in 2022 in the proportion of 2:1. The share traded ex-bonus on September 15, 2022. Before that BEL declared bonus shares in 2017 in the ratio of 1:10 and in 2015 in 2:1 ratio.

Bharat Electronics About: Established in 1954, BEL engages in manufacturing of specialised electronic equipment requirements of the Indian Defence Services. BEL produces a wide range of equipment for areas such as defence communication, radars, naval systems, c4i systems, weapon systems, homeland security, telecom & broadcast systems, electronic warfare, tank electronics, electro-optics, professional electronic components and solar photovoltaic systems, according to its official website.

Disclaimer: The stock has been picked from the brokerage report of UBS. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.