Bharat Electronics Limited is a state-owned electronic, aerospace and defence company with focus on developing and manufacturing electronic, opto-electronic, radar and C4ISR systems. The primary customers are the Indian Armed Forces, Indian Government and the Governments/ Militaries of friendly nations.
Although, the stock price has been in a state of decline since late 2017 - early 2018, the humongous order book along with assured orders, modernization of the Indian armed forces along with push for Make in India make it a very attractive buy for value investors.
Since August 2018, the stock is trading within a channel formed by the red zone in Fibonacci Retracement . As a value investor, I would have preferred to buy in the range of mid Rs.70 - low Rs.80 , however with the Moving Average lMA)ilines indicating that a trend reversal might be in the offing (bear to bull) I would likely put in an order around $90.
The stock offers a dividend of 2.09% with a P/E of about 13 and a P/B of 3, which are pretty respectable overall. From the volume analysis there seems to be strong support at low to mid Rs.70.
If the short MA (50 day, blue line) crosses the long MA (200 day, orange line) it could potentially trigger a bull rally. If this happens it would be typically after the elections with the NDA (which advocates a muscular defence policy) returning to parliament with a majority and after the May Earnings call.
The risk is that the bull run fails to develop and the stock falls to the Rs.75 zone. However, the triple bottom (pink arrows) and existing downward momentum lends to the evidence that the stock is poised to go up.
For more such analysis visit my website at https://advisacorp.com/articles.php
Although, the stock price has been in a state of decline since late 2017 - early 2018, the humongous order book along with assured orders, modernization of the Indian armed forces along with push for Make in India make it a very attractive buy for value investors.
Since August 2018, the stock is trading within a channel formed by the red zone in Fibonacci Retracement . As a value investor, I would have preferred to buy in the range of mid Rs.70 - low Rs.80 , however with the Moving Average lMA)ilines indicating that a trend reversal might be in the offing (bear to bull) I would likely put in an order around $90.
The stock offers a dividend of 2.09% with a P/E of about 13 and a P/B of 3, which are pretty respectable overall. From the volume analysis there seems to be strong support at low to mid Rs.70.
If the short MA (50 day, blue line) crosses the long MA (200 day, orange line) it could potentially trigger a bull rally. If this happens it would be typically after the elections with the NDA (which advocates a muscular defence policy) returning to parliament with a majority and after the May Earnings call.
The risk is that the bull run fails to develop and the stock falls to the Rs.75 zone. However, the triple bottom (pink arrows) and existing downward momentum lends to the evidence that the stock is poised to go up.
For more such analysis visit my website at https://advisacorp.com/articles.php