Bharat Forge shares hit a 52-week high on Monday, August 29 after Nomura said the stock was trading at an attractive valuation of 15 times the FY25 enterprise value/earnings before interest, tax, depreciation, and amortisation.
The company also announced that Kalyani Rafael Advanced Systems has secured contract worth Rs 287.5 crore from the Ministry of Defence for the supply of Missile Systems.
In a regulatory filing, the company informed that Kalyani Rafael Advanced Systems Private Limited, a joint venture between Kalyani Strategic Systems Limited (a wholly owned Defence subsidiary of Bharat Forge Limited) and Rafael Advanced Systems Limited of Israel, has bagged an order amounting to Rs 287.5 crore from the Ministry of Defence for the supply of Missile Systems.
The order is expected to be executed over the next 12 months.
Last week, Kalyani Strategic Systems bagged two export orders aggregating to EURO 93.87 million (around Rs 850 crore) from friendly countries for supply of components and armoured vehicle chassis to be executed over a 18 months’ timeframe. This is subject to necessary government approvals.
Bharat Forge is the flagship company of the Kalyani Group and a global provider of high performance, innovative, safety and critical components and solutions to various sectors including automotive, railways, defence, construction & aining, aerospace, marine, and oil & gas.
What Analysts Say?
The foreign brokerage firm finds the stock attractive keeping in mind the 31 per cent compounded annual growth in earnings per share over FY24-26.
Nomura has a ‘buy’ rating on shares of Bharat Forge with a target price of Rs 1,157.
The brokerage firm highlighted that the defence vertical continues to grow with more orders. Estimated defence order book is expected to rise to Rs 3,300-3,400 crore, it said.
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