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Business News/ Markets / Stock Markets/  PSU BEL's bonus shares issue decision today. Details inside

PSU BEL's bonus shares issue decision today. Details inside

BEL to consider a proposal for issue of bonus shares to the equity shareholders of the Company

BEL to consider bonus issue  (istock)Premium
BEL to consider bonus issue  (istock)

Bharat Electronics Ltd (BEL) on Monday had informed the exchanges that its board will meet today to consider the proposal of the issuance of bonus equity shares. Bonus shares are fully paid additional shares issued by a company to its existing shareholders.

“We wish to inform that a meeting of the Board of Directors of the Company is scheduled to be held on Thursday, the 4th August, 2022 inter alia to consider a proposal for issue of Bonus Shares to the equity shareholders of the Company," BEL had said in a BSE filing earlier this week.

BEL shares are up more than 58% in a year's period whereas the PSU defence stock has surged about 31% in year-to-date or YTD terms as compared to a per cent fall in benchmark BSE Sensex. Bharat Electronics Limited (BEL) is an Indian Government-owned aerospace and defence electronics company.

For the first quarter ended June 2022 (Q1FY23), the company's standalone net profit rose to 431 crore as against 11 crore recorded in the corresponding period of the previous year. Standalone turnover for the period stood at 3,063.5 crore against 1,564 crore in the same quarter last year. As of June 30, 2022, the company's order book position is around 55,333 crore.

“Bharat Electronics’ (BEL) management has reiterated its guidance of 15% top-line growth, 21-23% EBITDA margin and ~ 200 bn order inflow for FY23. Order inflow guidance for FY23 is in line with our assessment of 5 years’ order inflow possibility of 1,110 bn. Management highlighted that possible order inflow from QRSAM ( 200 bn) and MRSAM ( 150-200 bn) can happen in FY24," highlighted brokerage ICICI Securities in a post earnings note on July 21.

For the last 5 years, there has been an overhang on BEL’s earnings from the expectations of reducing margins. With management stating confidence to maintain margins in 21-23% range, with high confidence on achieving the upper band, it can be safely stated that margin compression concerns are a thing of the past. This is also likely to improve EPS growth prospects in BEL, in ICICI Securities' view.

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Published: 04 Aug 2022, 08:49 AM IST
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