Bharat Electronics has declared an interim dividend of 60% payable to all the eligible shareholders holding shares as of the record date.
Shares of Bharat Electronics Ltd (BEL) declined by 6.52% in the early trading hours of January 30, after the company missed its profit estimates for the third quarter of FY23 and higher material costs lowered the EBITDA margin.
BEL’s profit after tax rose 2.6% year-on-year (YoY), to ₹598.77 crore on a standalone basis from ₹583.37 crores in the same period a year ago, but was lower than ₹611.05 crores in the September 2022 quarter. Meanwhile, revenue from operations was reported as ₹4,064.90 crores up from ₹3,660.84 crores in Q3FY22 and ₹3,907.35 crores in Q2FY23.
On a standalone basis, the PSU company’s net sales increased 10.6% to ₹4,046.11 crore for the quarter that ended 31 December 2022 compared with ₹3,656.22 crores in the same quarter a year ago.
Total expenses rose 14.28% to ₹3,388.05 crore in Q3 FY23 over Q3 FY22. The cost of material consumed stood at ₹2,175.46 crore (up 10% YoY) and employee benefits expenses were ₹567.43 crores (up 12.6% YoY).
Brokerage firm, ICICI Direct, maintained a buy rating for the stock even as the EBITDA margin contracted 160 bps YoY (-103 bps QoQ) to 20.7%, lower than their estimate of 22.2% due to higher-than-expected raw material cost.
However, the company’s revenue was in line with expectations. The company’s board had on January 28 recommended an interim dividend of ₹0.60 per share (on a face value of ₹1 each) on the enhanced share capital of the company after the bonus issue of equity shares in September 2022. The dividend will be payable to all the eligible shareholders holding shares as of the record date of February 10, 2023.
BEL is a Navratna PSU under the Ministry of Defence. It manufactures electronic products and systems for the army, navy and the airforce. The government of India held a 51.14% stake in BEL as on 31 December 2022.