Motilal Oswal has issued a buy rating on Bharat Electronics with a target price of ₹530 in its research report dated July 27, 2026. According to the brokerage's analysis, the stock is expected to benefit from various large platform orders that will be finalized over the next few years from the Army, Navy, and Air Force. The recommendation is based on the company's strong fundamentals and growth prospects in the defense sector.
Bharat Electronics' Q1FY27 revenue/EBITDA/PAT came slightly lower than estimates, with margin performance impacted by an adverse revenue mix. As reported by Motilal Oswal, inflows for Q1 stood at ₹40 billion and are expected to improve in coming quarters from both base orders and large contracts. Despite the weaker-than-expected performance, the company has maintained its guidance of 15%+ revenue growth, 28%+ EBITDA margin, and inflows of ₹550 billion for FY27, including the QRSAM project.
The QRSAM project, worth ₹300 billion, is expected to be awarded by Q2FY27, according to Motilal Oswal's research. This significant defense contract represents a major growth opportunity for the company and supports its long-term revenue projections. The project's timing aligns with the company's guidance for substantial order inflows throughout FY27.
Motilal Oswal expects Bharat Electronics to post a 15%/14%/15% CAGR in revenue/EBITDA/PAT over FY26-29. The brokerage anticipates strong operating cash flow and free cash flow performance, driven by effective working capital management. The stock is currently trading at 42.5x/36.4x/32.4x P/E on FY27E/FY28E/FY29E EPS. The revised target price of ₹530 is based on roll forward to 45x Sep'28E earnings, up from the previous target of ₹510.
