Buy Bharat Dynamics, target price Rs 600: ICICI Securities

ICICI Securities has buy call on Bharat Dynamics with a target price of Rs 600. The current market price of Bharat Dynamics Ltd. is Rs 371.25. Time period given by analyst is one year when Bharat Dynamics price can reach defined target.

Bharat Dynamics Ltd., incorporated in the year 1970, is a Mid Cap company (having a market cap of Rs 6877.63 Crore) operating in Defence sector.

Financials
For the quarter ended 30-06-2021, the company reported a Standalone Total Income of Rs 156.19 Crore, down -86.56 % from last quarter Total Income of Rs 1162.08 Crore and up 149.39 % from last year same quarter Total Income of Rs 62.63 Crore. Company reported net profit after tax of Rs -20.95 Crore in latest quarter.


Investment Rationale
The brokerage initiates coverage on BDL with a BUY rating and DCF-based target price of Rs600/share (implying P/E of 15x FY23E). Key risks include delay in execution, higher LDs accruing because of the same, lower than expected orderbook accretion, and higher material costs.

Promoter/FII Holdings
Promoters held 74.9 per cent stake in the company as of June 30, 2021, while FIIs held 0.4 per cent, DIIs 17.9 per cent and public and others 6.8 per cent.