In This Article:
Release Date: January 30, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Bharat Electronics Ltd (BOM:500049) reported a significant increase in turnover, achieving a growth of 23.41% up to Q3 FY25.
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The company saw a substantial rise in profit before tax, with a growth of 43.86% compared to the previous year.
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Profit after tax increased by 42.34%, reflecting strong financial performance.
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The EBITA margin improved to 28.07% from 23.67% in the previous year.
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The order book position as of January 1, 2025, stands at INR71,100 crore, indicating a robust pipeline of future projects.
Negative Points
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The company has only achieved INR11,000 crore in order inflow against a target of INR25,000 crore, indicating potential challenges in meeting order targets.
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There are delays in finalizing contracts for several large projects, which could impact future revenue recognition.
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The non-defense segment remains a small portion of the business, contributing only around 10% to the total revenue.
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There are concerns about potential delays in the LCA program, which could affect the company's supply chain and revenue from this segment.
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The order book has seen a year-on-year decline of 6.7%, which may impact future revenue growth if not addressed.
Q & A Highlights
Q: Can you provide an update on the order inflow guidance for this year, given the previous target of INR 25,000 crore? A: We have achieved around INR 11,000 crore in orders this year against the target of INR 25,000 crore. Many projects are in the pipeline, and we are confident of achieving the INR 25,000 crore order inflow by the end of the financial year. (Chairman and Managing Director)
Q: Could you update us on the status of the QR-SAM project and its expected timeline? A: The QR-SAM project is progressing well, with ongoing discussions between the Army and Air Force. We expect to receive the order within the next 6 to 8 months, aiming for completion by March 2026. (Chairman and Managing Director)
Q: What are the major orders executed in Q3, and will there be any revision in guidance for FY25? A: Major orders executed in Q3 include LRM, WLR, ITC System, Shakti EW System, ADC&RS, and a civilian project named CIVIC. We will provide an update on guidance at the end of the session. (Chairman and Managing Director)
Q: How is the company addressing the delays with HAL regarding the LCA program? A: We are supplying electronic modules to the LCA program as per the agreed schedule with HAL. There are no significant challenges from our side, and we are meeting their requirements. (Chairman and Managing Director)