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Business News/ Markets / Stock Markets/  Gladiator stock: BEL shares can rally up to 11% from current levels
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Gladiator stock: BEL shares can rally up to 11% from current levels

The brokerage has given a ‘Buy’ action on BEL with a buying range between ₹93-97 and a target price of ₹109. This represents an upside of 11 per cent and the time frame given is 3 months

On Thursday, the stock declined 0.31 per cent to settle at ₹96.75 per share on the NSE. (Bloomberg)Premium
On Thursday, the stock declined 0.31 per cent to settle at 96.75 per share on the NSE. (Bloomberg)

Defence stocks have outperformed the market even during the current market downturn as a number of countries continue to increase their defence spending, including India. The sector has been in limelight in H2CY22 (second half, or H2 of Calendar 2022) and over the past three to four months have undergone healthy retracement of CY22 gains.

ICICI direct, in its report, said that Bharat Electronics Ltd or BEL within the Defense PSU space has undergone decent price/time correction, thus offering a favourable risk-reward proposition.

 

The brokerage has given a "Buy" action on BEL with a buying range between 93-97 and a target price of 109. This represents an upside of 11 per cent and the time frame given is 3 months. Stop loss can be kept at 87.

Shares of Bharat Electronics have risen 3.09 per cent in a month. On Thursday, the stock declined 0.31 per cent to settle at 96.75 per share on the NSE.

It expects the stock to resume its uptrend in the coming weeks and head towards 110, which is 80 per cent retracement of the entire decline of September 2022-January 2023 decline (114-87).

“Structural perspective, the share price has held its long term rising 52-week EMA that has held on numerous occasions since CY20. Over past one month while markets remained in corrective phase, share price of BEL bottomed out in January and underwent base formation, thus working out of overbought conditions," the brokerage said.

Fundamental outlook

Despite order inflow of just 3736 crore in 9MFY23, the management has reiterated its FY23 order inflow guidance of 20,000 crore. Major orders expected are Himshakti programme of 3300 crore, Atulya medium-power radar of 2000-3000 crore and orders worth 10,000 crore for radars and SONAR expected from naval shipyards.

Overall, expected double digit revenue, order inflow growth, sustained margins and strong order book are expected to ensure a better performance, the brokerage said.

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ABOUT THE AUTHOR
Meghna Sen
Business journalist tracking markets, companies, economy and crypto for Livemint. She has 6 years of experience with online and print publications. Email: meghnasen08@gmail.com
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Published: 03 Mar 2023, 09:25 AM IST
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