Bharat Dynamics shares rally 4% ahead of its board meeting

Shares of Bharat Dynamics Ltd were in demand at Dalal Street on Thursday ahead of its board meeting scheduled for today. The company board is likely to consider and approve the proposal for the interim dividend for the financial year 2023-24 and subdivision or stock-split of equity shares of the company.

Earlier this month, the state-run aerospace and defence player had informed the bourses about its scheduled board meeting for the aforementioned corporate actions. Also, the company had then changed the record date to April 2, 2024, Tuesday, for the purpose of payment of interim dividend on equity shares for the financial year 2023-24, if declared by the Board.

Shares of Bharat Dynamics surged more than 4.01 per cent to Rs 1,684.75 on Thursday, commanding a total market capitalization of more than Rs 30,700 crore. The scrip had settled at Rs 1,619.75 in the previous trading session on session on Wednesday.

Bharat Dynamics is a mini-ratna PSU company which is among the leading defence PSUs in India, is engaged in the manufacture of surface to air missiles (SAMs), anti-tank guided missiles (ATGMs), air to air missiles (AAMs), underwater weapons, launchers, countermeasures and test equipment.

Bharat Dynamics reported a 61 per cent rise in the consolidated net profit on a year-on-year (YoY) basis to Rs 135 crore for the December 2023 quarter. The ammunition and missile manufacturer's revenue from operations grew 30 per cent YoY to Rs 602 crore in Q3FY24. EBITDA for the reporting period was up by 32 per cent to Rs 119 crore.

"We believe Bharat Dynamics is strongly placed to benefit from increasing capital outlay for indigenised defence platforms like missiles, torpedoes and counter-measure dispensing systems. Valuation looks attractive given strong growth ahead led by multiple sectoral tailwinds," said ICICI Direct's report.

The company’s revenue and PAT have grown at 14.1 per cent and 16.9 per cent CAGR, respectively over the period FY 21-23, while its order backlog is estimated to be at Rs 20,000 crore, said ICICIDirect with a 'buy' rating and a target price of Rs 2,010. Another brokerage, Antique Stock Broking has a target price of Rs 2,038 in the stock with a 'buy' tag.

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