Bharat Electronics Oct-24

Bharat Electronics Limited Q2 FY25 Earnings Conference Call

• Date: October 28, 2024
• Call hosted by: Nomura Financial Advisory and Securities
• Management: Manoj Jain (Chairman and Managing Director), Damodar Bhattad (Director Finance and CFO), Sreenivas S (Company Secretary)
• Moderator: Umesh Raut
• Key financial highlights:
  • Turnover: INR2,853.0 crores (Q2 FY25) vs. INR7,365 crores (Q2 FY24), a growth of 15.83%
  • Profit before tax: INR2,488 crores (Q2 FY25) vs. INR1,777 crores (Q2 FY24), a growth of 40.05%
  • Profit after tax: INR1,867 crores (Q2 FY25) vs. INR1,343 crores (Q2 FY24), a growth of 39.03%
  • EBITDA: 27.26% (Q2 FY25) vs. 22.66% (Q2 FY24)
  • Earnings per share: INR2.55 (Q2 FY25) vs INR1.84 (Q2 FY24)
  • Order book position (October 1, 2024): INR74,595 crores

Order Inflows

• Target for FY25: INR25,000 crores
• First-half order inflow: INR7,500 crores
• Major expected orders for FY25:
  • Ashwini Radar: INR2,500 crores
  • Electronic Warfare Suite for MI-17: INR2,000 crores
  • ATULYA Order: INR2,000 crores
  • Shakti Phase IV: INR2,000 crores
• Management expressed confidence in achieving the FY25 target.

Working Capital

• Negative operating cash flow due to increased inventory for second half of year.
• Inventory stands at approximately INR9,000 crores.

Financial Year 25 Objectives

• Management expressed positive outlook for next year's performance.
• Current objectives include exceeding this year's turnover & profit margins.

Other Key Topics

• SBU Expansion (SBUs(Strategic Business Units) now numbers 29)
• Naval orders
• Artillery systems
• Foreign collaboration ratio stands at 15%
• Export focus & objectives (exports to reach 10% in coming years)
• Manpower planning (Hiring of 1,000+ employees)
• Defense budget outlook is continually positive.
• Order booking of INR75,000 crores