Next time you visit a polling booth to cast your vote, the incredible machine that records your vote is a shining example of how India uses technological advancements to conduct a free and fair world’s largest electoral process. And the company making it possible is Bharat Electronics Limited (BEL), a Navratna company established under the Ministry of Defence.
Not just the tamper-proof Electronic Voting Machine, popularly known as the EVM, BEL is meeting the specialized electronic system needs of Indian defence forces. It has achieved many milestones, such as developing the cutting-edge indigenous Akash Air Defense Weapon System, and is now expanding into global export markets. In this article, we will do a BEL company analysis and check the future growth potential of BEL share price.
BEL (Bharat Electronics Ltd) Government Action
The stock of BEL (Bharat Electronics Ltd) – After a historic announcement to ban the acquisition of 101 weapon systems and platforms from foreign countries, the government added another 101 defence equipment releasing the third ban list. The weapons and platforms are planned to be indigenised (made in India) progressively from December 2022 to December 2027. This step has been taken keeping the “Make in India” or “Aatmanirbhar Bharat” vision in focus.
In defence minister Rajnath Singh’s words, the third list is a symbol of 360-degree efforts being made by the government to achieve the vision of ‘Aatmanirbhar Bharat’.
These 101 items, with varying embargo timelines, include highly complex Systems, Sensors, Weapons and Ammunition like Light Weight Tanks, Mounted Arty Gun Systems, Guided Extended Range (GER) Rocket for PINAKA MLRS, Naval Utility Helicopters (NUH), Next Generation Offshore Patrol Vessels (NGOPV), MF STAR (Radar For Ships), Medium Range Anti-Ship Missile, Advance Light Weight Torpedo (Ship Launch), Medium Altitude Long Endurance Unmanned Aerial Vehicle (MALE UAV), High Endurance Autonomous Underwater Vehicle, Anti-Radiation Missiles, Loitering Munitions among others.
However, this outright ban on the import of these 101 weapons systems does not restrict defence sector companies in India from partnering with foreign companies for joint production in India in line with the government’s decision to hike the FDI limit in the defence sector from 49% to 74%.
This move is expected to give a thrust to domestic companies involved in the manufacture of arms, armaments and defence systems like L&T, BEL (Bharat Electronics Ltd), BEML, Bharat Forge etc. It will provide the domestic industry with ample opportunities to understand the trends and future needs of the Indian Armed Forces. Needless to say, the move will also stimulate fresh investments into technology and manufacturing capabilities boosting Research & Development (R&D) efforts.
With this, many stock market investors have a similar question in mind.
Is it the right time to Invest in Stock of BEL (Bharat Electronics Ltd. share price BSE)?
To help investors understand the answer, let’s first look at the business of BEL (Bharat Electronics Ltd) and its role in India’s defence sector.
History of BEL (Bharat Electronics Ltd)
Bharat Electronics Limited was established in 1954 after the Government of India announced a comprehensive industrial policy, empowering itself to set up infrastructure for manufacturing critical equipment.
From its humble beginning in 1954, BEL has become a multi-product, multi-technology, multi-unit conglomerate helping Indian armed forces to guard the nation’s border and interests. Its products are used in fighter jets, naval platforms, and other branches of the armed forces, for example, electronic warfare and avionics suite, anti-submarine warfare systems, C41 communication suite, surveillance systems, etc.
Currently, BEL also focuses on building products in the non-defence sectors like civil aviation, anti-drone systems, satellite assembly and integration, railway & metro solutions, energy storage solutions, etc.
As of 5th April 2023, the market cap of Bharat Electronics Ltd. stands at ₹71,343 crores. In FY22, BEL reported a sales turnover of ₹15,044 crores with higher double-digit EBITDA and PAT margins.

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BEL (Bharat Electronics Ltd) Business Overview
BEL has established itself as a critical defence manufacturer in India, but it also aims to increase its revenue share from non-defence products and exports. Since BEL is involved in defence equipment manufacturing, such companies are exempted from segment reporting in India.
Without a segment report, we are dividing BEL’s business into two segments- defence and non-defence and will analyze their performances.
Defence
In FY22, the defence business generated almost 90% of revenue for the company – ₹13,504 crores. BEL has core competencies in developing Radar and Fire Control Systems, Electronic Weapons Systems, Avionics, Warfare Systems, Electro-Optics, Tank-Electronics, etc. All the products are manufactured at nine manufacturing plants having 24 strategic business units (SBUs).
The company has recently diversified into manufacturing Arms & Ammunition, Seekers & Missiles, Networks & Cyber Security, and Unmanned Systems. The company’s order book stood at ₹60,500 crores at the end of FY23, of which defence contracts constitute a significant portion and have an execution time of nearly four years.
During the previous fiscal year, the company received numerous prestigious contracts, including the manufacture and supply of Radar Warning Receivers (RWR) and Missile Approach Warning Systems (MAWS) from Airbus for 9.32 crore under the C295 aircraft program, the most significant avionics order from HAL worth around ₹2,400 crores for the Tejas Fighter Aircraft Program, and so on.
Non-defense
In FY22, the company earned ₹1,540 crores from the sales of non-defence products and solutions for the civilian market. BEL has core competencies in EVM & VVPAT, Healthcare Solutions, Civil Aviation, and Solar Cells. The company delivered a record number of ICU-grade ventilators and oxygen concentrators during the first and second waves of the pandemic.
BEL Management Profile
BEL is led by Mr Bhanu Prakash Srivastava, the Director (of other units) and assumed the additional charge as Chairman & Managing Director on April 20, 2022, and Director (Marketing) on November 1, 2022. Mr Srivastava joined BEL in August 1986 and has gained diverse experience in every function of the company with exposure to international business.
Mr Vinay Kumar Katyal has been the Director of Bangalore Complex since November 27, 2018. He joined the company in June 1985 as Deputy Engineer after completing his BTech from IIT-BHU. Specializing in communications, Mr Katyal played a crucial role in developing the communication product suite for the company.
Mr Manoj Jain is the Director (Research & Development) and assumed additional charge as Director (HR) on November 1, 2022. He joined BEL in August 1991 as a probationary engineer and made significant strides in the field of R&D for the company.
Mr Damodar Bhattad is the Director (Finance) and is a chartered accountant. He joined BEL in 1988 as an accounts officer and played a key role in achieving higher revenue and a steady flow of orders for the company.
BEL Shareholding Pattern

BEL (Bharat Electronics Ltd) Financials
Revenue
In FY22, BEL reported its highest-ever turnover of ₹15,044 crores, 8.8% higher compared to ₹13,818 crores in FY21. The export revenue contributed ₹236 crores. The company’s consolidated revenue has grown at an 8.32% CAGR in the last five years.
BEL’s Q3FY23 turnover stood at ₹4,046 crores, up by 20.51% over the previous year’s period. And, 9MFY23 turnover is at ₹11,005 crores, compared to ₹8,842 cores in 9MFY22, up by 24.46%.

EBITDA
In FY22, BEL reported an EBITDA of ₹3,309 crores, and the EBITDA margin stood at 22%, compared to ₹3,181 cores and a margin of 23% in FY21. As a result, EBITDA has grown at a CAGR of 13.43% in the last five financial years.

Net Profit
BEL’s net profit in FY22 was ₹2,349 crores, up from₹2,065 crores in FY21. And, in Q3FY23, the net profit was ₹613.50 crores, up 2.17% from ₹596.11 crores in Q3FY22.
In the last five financial years, BEL’s net profit has grown at a CAGR of 8.7%. And BEL’s net profit for 9MFY23 is at ₹1,604.23 crores, up 28.84% from ₹1245.13 crores in the previous year’s corresponding period.

BEL (Bharat Electronics Ltd) Financial Ratios
Current Ratio: In FY22, BEL’s current ratio declined marginally to 1.39 times from 1.41 times in FY21.
Debt-to-equity Ratio: The company has no debt in its book. Hence the debt-to-equity and interest-coverage ratio is not applicable.
Net Profit Margin: Over the last several years, the company has maintained a double-digit net profit margin, with net profit margins of 16% and 15% in FY22 and FY21, respectively.
Return on Net Worth: The return on net worth in FY22 has increased to 19.6% from 19.11% in FY21. The metric indicates the profit-earning capacity of the company’s shareholders invested amount.
BEL Share Price Analysis (Bharat Electronics Ltd)
BEL has an incredible history of wealth creation for its shareholders. Over the years, BEL has done three bonus issues in the ratio of 2:1, 1:10, and 2:1 and a split in the 1:10 ratio. Meaning 100 shares at the launch of the IPO have now become 9,900 shares.
The following table shows the details
Corporate Actions | Face Value | Ratio | Number of Shares |
Pre-bonus and split share | ₹10 | 100 | |
Bonus Issue- 14th September 2015 | ₹10 | 2:1 | 300 |
Split- 16th March 2017- New Face Value- Face Value- ₹1 | ₹1 | 1:10 | 3000 |
Bonus Issue- 10th August 2017 | ₹1 | 1:10 | 3300 |
Bonus Issue- 15th September 2022 | ₹1 | 2:1 | 9900 |
The price adjusted of bonus and split; BEL share price rose from ₹0.22 on 1st January 1999 to the current price of ₹98 as of 6th April 2023. An initial investment of ₹1 lakh is now worth over ₹45 crores. In the last three, five and ten years, BEL share price has given a CAGR return of 62%, 15%, and 23%, respectively, as of 6th April 2023,

Furthermore, BEL has a consistent record of paying its shareholders dividends. For example, in the last three calendar years, 2020, 2021, and 2022, BEL paid ₹2.8, ₹4, and ₹4.5 as dividends.
BEL Share Price Fundamental Analysis
BEL has established itself as a major defence manufacturer in India with a strong focus on electronics and communications, which gives it an edge. It has a strong order book of ₹60,500 crores at the end of FY23, indicating substantial revenue and earnings growth in the next few years.
As the government pushes for Make-in-India in the defence sector, companies with diverse product suites and strong execution capabilities, such as BEL, are likely winners.
The key growth areas where BEL is focusing currently:
Exports: The company is increasing its revenue share from exports, with a long-term goal of 10-15%. Exports currently account for only 2% of total turnover. BEL is working with Malaysia, Bangladesh, Nepal, Chile, and other South Asian countries to increase export revenue by developing new markets. It has also pursued numerous G2G opportunities in many neighboring countries.
Non-defense Products: Currently, non-defence products account for 10% of the total turnover, and BEL is ramping up to diversify its revenue mix. The company focuses on developing innovative city solutions, energy storage solutions to tap the rapidly-growing EV market in India, space electronics in collaboration with ISRO, Railways and Metro communication systems, Civil Aviation segment, etc.
Strong Capex: BEL is making capital expenditure of ₹600-800 crores in the next two years for the setting up of a defence system integration complex in Nagpur, an Arms and Ammunition facility in Hyderabad, and an advanced night vision factory at Nimmakuru, Andhra Pradesh.
Strengths of BEL (Bharat Electronics Ltd)
Wide Range of Products
What makes BEL a strong player is that it has a wholesome suit comprising a wide range of products built by multiple in-house technologies. The company has a strong reputation for quality excellence and the ability to develop innovative solutions that deliver superior performance.
BEL has an unbeatable track record in research and development right from the beginning. It has also successfully partnered with Defence Research & Development Organisation (DRDO), another premier government agency, to set up production labs across the country. Not only in India but BEL designs, develops, manufactures and ships various products and systems to global clients addressing their diverse needs. That’s the primary reason behind BEL’s strong order book.
Positive Cash Flow
With a strong emphasis on cost-cutting measures and indigenization efforts to improve profitability, BEL has maintained a healthy EBITDA margin of more than 20%. It will lead the company to meet revenue and profitability targets. The company has sufficient cash reserves, and increasing cash flow from operations will assist in meeting all working capital and CAPEX requirements through internal accruals.
Inflating order book – Booster for BEL (Bharat Electronics Ltd)
BEL (Bharat Electronics Ltd) had a robust order book worth Rs. 57,570 crores* as on 1 April 2022. Defence being the key business line of BEL, it brought in 90% of revenue. FY22 being an exceptional year, BEL received new orders worth Rs. 19,016 crores during the same period.
Some of the major orders include Avionics Package for LCA, Advanced EW Suite for Fighter Aircraft, Instrumented
Electronic Warfare Range (IEWR), CDR TI cum Day Light Sights, Dhanush Gun Upgrade, Nayan EW Systems, WLR
(Mountain), Electronic Voting Machine & VVPAT and more.
BEL received its biggest-ever export order from Airbus Defence & Space (USA) for the manufacturing & supply of MAWS&RWR for C-295 Aircraft. Moreover, the company anticipates progressive order inflow in the next 2-3 years.
Being the sole manufacturer and supplier of many key defence systems and weapons systems in the country currently, BEL enjoys a huge monopoly. Now let’s take a look at the key financials of BEL (Bharat Electronics Ltd). BEL (Bharat Electronics Ltd) has shown consistent growth in net profit over the last three years.
Debt levels of BEL (Bharat Electronics Ltd)
Before investing in the stock of BEL (Bharat Electronics Ltd) or any stock, it is very important to check the debt levels of the company. A company with zero or low debt will not only have enough cash to reward its shareholders with dividends but also adequate capital to fund further growth and expansion plans.
On the other hand, any company which has heavy debts will have the burden to pay huge interest every month, which will affect its expansion plans significantly. BEL (Bharat Electronics Ltd) is a debt-free company which is a very important attribute in fundamental investing. Its
BEL (Bharat Electronics Ltd) is a good dividend paymaster
BEL (Bharat Electronics Ltd) has consistently declared dividends over the last few years. For the year ending March 2022, BEL declared a dividend of Rs 4.50 per share. In terms of the current market price (BEL share price NSE) of Rs 281.65 as on August 8, the dividend yield of BEL is 1.60%. Bharat Electronics Ltd share price NSE.
Sectoral Overview: A Bright Future for Defence Sector
The Indian defence sector, in the last five years, has grown substantially. With the government’s clear vision of increasing indigenous components in defence systems manufactured in India and exports, the sector is poised to witness robust growth in the coming years.
One of the major progresses made in defence procurement from foreign companies is the offset contracts, which require foreign companies to award a part of the contract value to Indian defence companies and strengthen the defence ecosystem in the country. In recent years, offset contracts worth $4.3 billion have been signed that could spur growth.
The joint venture between major global defence suppliers and Indian companies is further helping to create an ecosystem that could support domestic and export demand. One example is the joint venture between Tata and Airbus to manufacture C-295 transport aircraft in India.
BEL Share Price Target – Growth Potential
Defence companies like BEL will likely benefit the most from the government’s new defence policies and impetus to Atmanirbhar Bharat. Some of the factors that could aid the rise in BEL share price:
- Leveraging on its R&D capabilities in expanding its non-defence solutions
- Expanding the list of bans on the import of defence goods by the Government of India
- Increase in EBITDA margins and signing of big export contracts
- Collaboration with global defence OEMs to integrate best practices in the defence production process
Despite all the positives for Bharat Electronics, it faces stiff competition from private sector companies. However, the hike in FDI to 74% in defence joint ventures will help private sector companies to level up their play and eye for big contracts from the Indian Armed forces, where state-run defence companies dominate. Furthermore, rapid changes in defence technologies can also impact BEL’s growth.
Bottom line – Should you Invest in Stock of BEL (Bharat Electronics Ltd)?
While BEL (Bharat Electronics Ltd) has been an outperformer right from its early days and also has an assured market for its products from the government’s defence purchases, one should also consider the fact that some PSUs which earlier had a monopolistic advantage lost their sheen with time after a level playing field was introduced or due to underperformance.
One such prime example is the stock of MTNL, which after failing to bear the onslaught of private sector telecom companies, is now languishing in single digits from highs of around Rs.387 levels in its glory days. Many other defence projects of other PSUs have been dogged by excessive budget escalations and huge delays. The best example of this is the light combat aircraft project first conceived in the 1980s to replace the ageing MIGs in the Indian Airforce but entered service only after four decades and is still powered by American engines.
When you look at the stock of BEL (Bharat Electronics Ltd) from a fundamental point of view, there are some things that tick the right boxes, such as consistent dividends to shareholders and visionary management. However, before investing in the shares of BEL or any stock, there are several other important factors too which an investor should keep in mind, such as return on equity, future growth, profit margins, and BEL’s underlying value and potential for future growth.
FAQs
When was Bharat Electronics Ltd. incorporated?
Bharat Electronics Ltd. is an elite defence PSU incorporated in 1954 after the Government of India introduced a comprehensive industrial policy. It specializes in manufacturing communication and electronic military equipment for armed forces, such as the Akash Air Defense System, Radar and Electronic Warfare systems, etc.
How has the BEL share price performed in the past?
BEL share price has grown by leaps and bounds, creating massive wealth for its shareholders. Adjusted for bonuses and split, BEL share price rose from ₹0.22 on 1st Jan 1999 to an all-time high of ₹111 in September 2022.
Is Bharat Electronics Ltd a debt-free company?
Yes, Bharat Electronics is a debt-free company and meets all its CAPEX and working capital requirements through internal accruals.
Disclaimer Note: The stocks and financials mentioned in this article are for information purposes only. They shouldn’t be considered as a recommendation by Research & Ranking. We will not be liable for any losses that may occur.
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