Bharat Electronics Q3 Results Review - Execution Inline; Higher Costs Impact Margins: ICICI Direct

ICICI Direct Report

Bharat Electronics Ltd.'s revenue came inline with estimates; higher than expected raw material costs impacted margins. Revenue increased 11.8% YoY (up 4.7% QoQ) to Rs 4131.0 crore; largely in line with estimates. The growth was primarily driven by better execution.

Ebitda margin contracted 160 basis points YoY (down 103 bps QoQ) to 20.7%; lower than our estimate of 22.2%. This was primarily on account of higher than expected raw material cost.

Bharat Electronics' profit after tax increased 2.6% YoY to Rs 598.8 crore against our estimate of Rs 653.1 crore; primarily due to lower-than-expected operating profit margin.

Order backlog was at Rs 50116 crore as of December 2022 end (2.9 times trailing twelve months revenues). Implied order inflows were at Rs 1452 crore during Q3 FY23 and Rs 3736 during nine months-FY23.

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