HAL, BEL, BDL, GRSE, PTC Industries: Q4 previews, defence stocks to buy, target prices & more

PTC Industries, Zen Technologies, Astra Microwave and Azad Engineering are some of the defence players that could report 50-175 per cent year-on-year (YoY) rise in March quarter profits. Bharat Dynamics Ltd (BDL) and PTC Industries may clock doubling of Q4 sales, ICICI Securities said in its preview note on defence sector.

While Q4FY25 was a little low-key affair for defence players with domestic focus, exports-oriented players are expected to fare better, the domestic brokerage said. 

Among defence PSUs, ICICI Secuities said revenue growth of (103 per cent YoY) is expected to be the highest for BDL as execution issues pertaining to MRSAM are behind. Revenue growth of PTC Industries is seen aided by the consolidation of Trac Precision -- with revenue rate of Rs 300 crore per annum. Solar Industries may also see strong 47 per cent sales growth, gaining from continued traction in defence and export & overseas segments, though traction in India business remained relatively weak. 

Azad Engineering may record revenue growth of 32 per cent YoY with healthy Ebitda margin of 35 per cent, ICICI Securities said. Meanwhile, a drop in revenue growth (YoY) is expected for HAL, in line with its execution plan.

Here are Q4 results previews for 11 defence companies and ICICI Securities' prevailing target prices on the respective stocks:     

"Going ahead, we expect execution at HAL to pick up, following delivery of F404 engine by GE Aerospace. In case of SOIL, we expect revenue from defence segment to rise 2x YoY to INR 27bn in FY26E, mainly due to execution of export orders. Among aerospace players, we expect order traction to sustain for both Azad and PTC Industries as they are part of global supply chains of OEMs. We believe capacity utilisation at both these companies is the key for their earnings growth," the brokerage said. 

For Astra Microwave, ICICI Securities expects continued traction in the domestic defence business to aid earnings growth. Closing orderbook likely to be the highest-ever, it said.

BDL's sales growth, both YoY and QoQ, are likely driven by the execution of pending MRSAM order. ICICI Secuirties expects execution to improve further as Akash order starts getting executed from Q1FY26.

The domestic brokerage is factoring in lower Ebitda margin, in line with execution plan and company’s annual guidance. Commentary on order inflow will be critical.

In the case of Garden Reach Shipbuilders, deliveries of vessels were as per the schedule and milestone-based payments for the same could drive earnings growth. 

ICICI Securities believes HAL's sales growth was impacted by lower-than expected manufacturing revenue in Q4 due to operational issues for ALH Dhruv and delay in supply of F-404 engines. MIDHANI's sales growth likely to remain broadly stable YoY and the improvement in Ebitda margin could result in earnings growth.

The brokerage pegged Solar Industries' defence revenue at Rs 420 crore in Q4FY25 despite domestic execution delays. Exports and overseas segments may do well in Q4FY25, it said.

For Azad Engineering, ICICI Securities expects revenue growth of 32 per cent YoY and Ebitda margin of 35 per cent YoY, thanks to aerospace segment and new order wins.

Dynamatic Technologies' aerospace segment may continue to do well, but hydraulics segment could languish. Positive commentary for metallurgy segment, driven by EU demand for ammunition, is likely. 

For Zen Technologies, healthy execution is likely on the back of orders already in place. The company could achieve its FY25 guidance, ICICI Securities said.