BEL's stock likely to rise another 22% after giving 118% return in one year: UBS
The company has also received additional orders worth Rs 114.59 crore since the last disclosure on January 30, 2024, and these orders pertain to the supply of SDRs, HD VLF receivers, EVMs, etc., according to the company's filing with the exchanges added.
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Shares of PSU defence major Bharat Electronics (BEL), similar to other PSUs, have given handsome returns of over 100 per cent in a year, doubling investors' wealth. Further, this rally is expected to not recede going forward, as global brokerage UBS has given a buy call on the counter and raised the target to Rs 257 from the earlier Rs 205.
Considering the last closing price, this target implies a possible upside of 22 per cent.
The brokerage maintains that there is significant order book accretion underway and FY24E marks a shift in annual order inflow, while the pipeline adds to growth comfort. The brokerage further stated that the company's management expects Rs 50,000 crore in total orders in FY25/26 (QRSAM of Rs 100 billion included).
Earlier in mid-February, the company announced that it had signed a contract for a value of Rs. 2,167.47 crore plus taxes with the Indian Navy on February 13, 2024, for the supply of state-of-the-art indigenously designed and developed EW suites for use onboard warships. This EW suite is a big leap towards the Aatmanirbhar Bharat initiative of BEL.
The company has also received additional orders worth Rs 114.59 crore since the last disclosure on January 30, 2024, and these orders pertain to the supply of SDRs, HD VLF receivers, EVMs, etc., according to the company's filing with the exchanges added.
Technically, the stock's RSI, or relative strength index, is in an overbought zone, suggesting that the stock is primed for a corrective price pullback. Nevertheless, it trades above its 30-day, 50-day, 100-day, and 200-day SMA, or simple moving average, signalling that the stock is in a long-term uptrend.
The stock also trades at a relatively cheap valuation, with a twelve-month trailing (TTM) price-to-earning below industry levels of 43.1.
After the Maharashtra MSME Defence Expo, which took place between February 24 and 26 in Pune, brokerage firm Incred Equities maintained an overweight stance on the overall sector.
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