Defence

Bharat Electronics (BHE) delivered robust Q2FY26 performance, with revenue surging 26% YoY and OPM at 29.4% (versus Street’s estimate of 26.8%), significantly beating consensus. OI surged ~2x YoY (but down 30% QoQ) to

Zen Technologies (ZTL) reported subdued inflows in Q2FY26 as government prioritised emergency procurements following Operation Sindoor, leading to deferment of simulator/training equipment orders (~73% of ZTL’s FY25 OB)

India’s defence sector is in a high-growth phase, supported by strong ~INR10tn DPSU pipeline, likely higher budget allocation, particularly towards Air Force and Navy and an accelerated indigenisation push. MoD’s new

We recently interacted with management of Centum Electronics (CTE), which is a niche, high-reliability electronics player possessing strong Defence, Aerospace and Space linkages (56% of sales). Given a presence across

Hindustan Aeronautics (HNAL) reported a better-than-expected Q1FY26 result driven by strong execution (10.8% YoY) lifting OPM to 26.7% (beating Street’s 23% estimate). A staggering order book of ~INR1.84tn (at

Bharat Dynamics (BDL) reported subdued profitability overshadowing robust execution, which surged 30% YoY to INR2.5bn during Q1FY26. A strong backlog of INR228bn (~7x FY25 sales) coupled with INR428bn of pipeline lends

Despite an early monsoon dampening the domestic explosives business, Solar Industries (SOIL) posted an in-line Q1FY26 (versus Street/Nuvama) led by International (43% YoY) and Defence (115% YoY). Management retained FY26

Data Patterns (DPIL) missed Street’s revenue/EBITDA estimate by 25%/33% primarily led by muted execution due to customer approval delays (shall normalise in coming quarters). Order inflows came in at INR1.8bn (growing 5x

Bharat Electronics (BEL) yet again posted strong OPM of 28.1% in Q1FY26 (consistently beating its own guidance for the past six–eight quarters). Revenue grew steadily by ~5% YoY to INR44.2bn (~INR2bn deferral) while OI

Zen Technologies (ZTL) reported an overall muted set of Q1FY26 numbers given a slowdown in OI momentum persists for a fifth quarter in a row. Consolidated order backlog is now at INR7.54bn (0.7x FY25 sales, down from

Nuvama Defence coverage reported stellar order intake/execution-led Q4FY25 as ordering momentum picked up after a weak 9MFY25 (due to general elections). We prefer the Defence Electronics segment, which shall grow 2–3x

Bharat Dynamics (BDL) posted a strong top line (+108% YoY) driven Q4FY25, extending strength into next year. Order inflows for FY25 came in at ~INR67bn, increasing the backlog to INR228bn (~7x FY25 sales), providing

Solar Industries (SOIL) reported a decent Q4FY25 showing as it extends strength to next year with defence backlog ballooning to ~INR152bn (55% exports mix). We believe SOIL’s consistent new product development/expansion

Bharat Electronics (BEL) positively surprised on OPM (30.6%, up 390bp YoY) in Q4 surpassing Street’s headline numbers as revenue grew 6.9% YoY to INR91.2bn. FY25 OI at INR187bn fell short of INR250bn guidance but

Data Patterns (DPIL) ended FY25 with strong execution-led earnings growth beating Street’s Q4FY25E revenue/PAT by 18%/12%. OI in Q4FY25 was muted at INR312mn, taking the backlog to INR7.3bn (1x FY25 sales). Highlights:

Zen Technologies (ZTL) posted a strong quarter, beating Street’s Q4FY25 revenue/EBITDA estimate by 22%/8% (exceeding FY25 revenue guidance of INR9bn). OI momentum picked up (INR1.7bn in Q4FY25) after a muted 9MFY25 as

Hindustan Aeronautics (HNAL) reported a strong end to FY25 as it beat Street’s Q4FY25 revenue/EBITDA estimate by 4%/42% on the back of ~38.7% OPM. Buoyant order inflows of INR1.2tn during FY25 (Su-30 Mk1, AL31FP engines,

Battlefield layout: How big is the landscape? India has set forth ambitious plans to transition from being the world’s second-largest defence importer (8.3% of global imports in 2020–24 as per SIPRI) to becoming a

Zen Technologies (ZTL) reported a sluggish Q3FY25 OI for a third quarter in a row due to delay in order finalisations by MoD. An INR600mn delay in shipment led to weak execution (~41% dip QoQ), yielding lower OPM (~26%;

Solar Industries (SOIL) posted another strong quarter on robust execution driving up Q3FY25 revenue 38% YoY and OPM to ~26.7% (~25% guided) on rising defence mix (5.6x YoY) plus exports (20%+ YoY). OB swelled to