Bharat Electronics reports strong H1 FY26 results, boosts order book to Rs 75,600 crore, eyes 10% export contribution.

Bharat Electronics Limited (BEL) has demonstrated robust financial performance in the first half of fiscal year 2026. Revenues grew by 15.6% year-over-year to Rs 10,231 crore, driven by the strong execution of orders worth approximately Rs 4,000 crore across seven major programs. Profitability also saw significant improvement, with EBITDA climbing 25.2% to Rs 2,940 crore, leading to a 220 basis points expansion in EBITDA margins to 28.7%. Net profit rose by a healthy 19.9% to Rs 2,257 crore.

The company's order book stands strong at Rs 75,600 crore, offering substantial revenue visibility for future execution. BEL has already secured Rs 14,750 crore in fresh orders for the current fiscal year and anticipates significant contributions from upcoming tenders, including the Next Generation Corvette program and an LCA avionics package from Hindustan Aeronautics Limited (HAL).

BEL is also focusing on strategic collaborations, such as its partnership with L&T on the AMCA program, aiming to enhance its capabilities in advanced airborne platforms. The company plans substantial investments, with Rs 1,600 crore earmarked for Research and Development (R&D) and over Rs 1,000 crore for capital expenditure in the current year. Additionally, a Rs 1,400 crore investment is planned for a Defence System Integration Complex (DSIC) in Andhra Pradesh over the next 3-4 years.

A key strategic goal is to increase exports, targeting a 10% contribution to turnover within five years, with an interim target of 5% in the next 2-3 years. BEL's stock is trading at 38 times its FY28 estimated earnings, which analysts consider reasonable given its strong order pipeline and growth prospects in both domestic and international defense markets.

Impact: This news is highly positive for Bharat Electronics Limited and the Indian defense manufacturing sector. The strong financial performance, coupled with a substantial order book and clear strategic growth plans including export expansion and significant investments in R&D and infrastructure, points to sustained future growth. This can lead to a positive sentiment and potentially drive the stock price higher, reinforcing India's 'Make in India' initiative in defense. Rating: 8/10.

Difficult Terms: EBITDA: Earnings Before Interest, Taxes, Depreciation, and Amortization. It is a measure of a company's operating performance. Basis Points: A unit of measure equal to one-hundredth of a percent (0.01%). Used to describe small changes in percentages. YoY: Year-over-Year. A comparison of financial data over a specific period in one year to the same period in the previous year. FY26: Fiscal Year 2026. In India, this typically runs from April 1, 2025, to March 31, 2026. FY28: Fiscal Year 2028. In India, this typically runs from April 1, 2027, to March 31, 2028. Order Book: The total value of contracts that a company has secured but not yet completed. It indicates future revenue. LCA Mark 1A: Light Combat Aircraft Mark 1A, an indigenous multirole fighter aircraft developed by Hindustan Aeronautics Limited (HAL). LRSAM: Long Range Surface-to-Air Missile. HIM Shakti: A specific defense program or system, details may vary. QRSAM: Quick Reaction Surface-to-Air Missile. AMCA: Advanced Medium Combat Aircraft, a future fifth-generation stealth fighter aircraft program. HAL: Hindustan Aeronautics Limited, an Indian state-owned aerospace and defense company. DSIC: Defence System Integration Complex, a facility for integrating defense systems. R&D: Research and Development, activities undertaken by companies to innovate and introduce new products or services. Capex: Capital Expenditure, funds used by a company to acquire, upgrade, and maintain physical assets such as property, buildings, or equipment.