Bharat Dynamics Bags 'Neutral' Rating As Motilal Oswal Initiates Coverage — Here's Why

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Motilal Oswal Report

Bharat Dynamics Ltd.'s stock is currently trades at 70x/52x/38x P/E on FY26/27/FY28 estimates. We initiate coverage on the stock with a Neutral rating and a target price of Rs 1900 based on 42x Sep’27E price/earnings.

We like the business model of Bharat Dynamics and its ability to scale up its revenues and order book in current scenario, however, with fair valuations, we would look for lower price points to enter the stock.

Key risks and concerns

Key risks for the company include a decline or reprioritization of the Indian defense budget, termination of existing contracts or failure to succeed in tendering projects, changes in procurement rules and regulations of the MoD and the government, and supply-chain-related issues.

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