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Informist, Wednesday, May 20, 2026

 

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--Bharat Electronics: Will create high computing infrastructure very soon 
--CONTEXT: Comments by Bharat Electronics mgmt at post-earnings call 
--Bharat Electronics: Rise in semiconductor prices won't impact margin much 
--Bharat Electronics: Have an orderbook of around INR 740 bln currently 
--Bharat Electronics: Current cash position okay to sustain plans for future 

 

By Astha Oriel and Anand JC 

 

NEW DELHI – The management of Bharat Electronics Ltd. has given a capital expenditure guidance of INR 12 billion for the financial year 2026-27 (Apr-Mar). The management was speaking to analysts after the company declared its financial results for the March quarter and FY26. "The defence to non-defence ratio, more or less it will be 90 to 10, maybe plus-minus 1%," the management said. "It may vary based on our new plans for non-defence business."

 

The management has retained the revenue growth guidance of more than 15% for FY27. "...after taking into consideration our present pace, our present product mix, our present order book, etc., and seeing all the challenges or geopolitical situations in mind, we are retaining our revenue growth of more than 15%," it said.

 

The guidance for earnings before interest, tax, depreciation, and amortisation margin for FY27 is more than 28%, while order inflows are expected to be over INR 550 billion, according to the management. The company aims to spend INR 22 billion on research and development in FY27.

 

The company currently has an order book whose value comes to around INR 740 billion. "The order book of around Rs.74,000 crores (INR 740 billion) mainly consists of some big-ticket (items. A) few items I will just mention," a management official said. "The electronic fuses, the LRFM (light range finder module), the LCA (light combat aircraft) Mark I, Mark I-A LRUs (line replaceable units), DMP2 upgrades, spare services and maintenance items, Ashwini radar, then EW 24 (electronic warfare 24), E17 V5. So these are the major projects which we are going to execute in the next 2-3 years. Out of that, all items we are supplying next year also." 

 

The increase in prices of semiconductors is unlikely to have any significant impact on the company's margins, according to the management. It said semiconductors account for 17-19% of the company's material costs. "All semiconductors right now are imported, because still in India that infrastructure is just coming up.... Semiconductor per se is around 17-19% of our material cost... Overall, on the margin, it (semiconductor prices) may not affect us that much. And, of course, we are in the process of indigenising some of the technology itself. And that way we would compensate for this price offset," the management said. 

 

It further said the defence major will create high-tech computing infrastructure very soon. The company has invested a minimum of INR 1 billion in the past two years, according to the management. "And at least around INR 100 to 200 crore (INR 1 billion–INR 2 billion) worth of investments are in different stages of approval. So, that is the main capex (capital expenditure) which is required. The building and other infrastructure, caching infrastructure, integration infrastructure, that is definitely much less as compared to the computing infrastructure," the management said. 

 

For the March quarter, Bharat Electronics reported a rise of nearly 5% on year in its net profit to INR 22.03 billion. The Navratna public-sector undertaking's revenue for the quarter was up nearly 12% on year at INR 101.77 billion. The company released its earnings after market hours Tuesday. Wednesday, its shares closed at INR 413.30 on the National Stock Exchange, down more than 2% from the previous day.  End

 

Edited by Rajeev Pai

 

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