Bharat Dynamics shares hit 52-week high; YTD, stock jumps 66%: Here is why investors are gung-ho

Shares of Bharat Dynamics (BDL) surged over 7.3% to hit its 52-week high of ₹1,938.6 apiece as defence stocks continue to rally.

Since the Pahalgam attack, Operation Sindoor came as an important development not only for the Indian armed forces but also for the defence stocks. The operation was launched in the early hours of May 7 as a response to the terror attack.

From May 7, shares of Bharat Dynamics have soared 18.25%. In the last five trading sessions, the stock has gained over 20%. Year-to-date, BDL shares zoomed 66%.

Further, investors also became optimistic after Defence Minister Rajnath Singh said that India’s defence exports witnessed a 34-fold increase over the last decade, reaching an all-time high of ₹23,622 crore in the financial year 2024-25.

The minister had highlighted the increase in defence exports days after India carried out precision strikes on terror infrastructure across the border under Operation Sindoor.

Defence PSUs recorded a 42.85% growth in exports, contributing ₹8,389 crore in FY 2024-25 as compared to ₹5,874 crore in 2023-24. The private sector contributed ₹15,233 crore, marginally up from ₹15,209 crore in the previous fiscal.

This is also increasing market participants’ interest in defence stocks like Bharat Dynamics.

This week defence shares were trading higher following Prime Minister Narendra Modi’s address to the nation on May 12, where he lauded the effectiveness of “Made in India” defence equipment during Operation Sindoor.

PM Modi said Operation Sindoor against Pakistan is not over and the time has come for 'Made in India' defence equipment. “India has showcased its excellence in new-age warfare. The time has come for 'Made in India' defence equipment,” he said.

India’s in-house defence production reached ₹1.27 lakh, the highest ever, in FY24. The country produces approximately 65% of its defence equipment domestically as of today, as against a 65-70% import dependency ten years ago.

For the December quarter of FY25, Bharat Dynamics had posted a 9% rise in its net profit to ₹147.12 crore as compared to ₹135.03 crore in the corresponding quarter last fiscal.

The PSU’s revenue from operations increased by 38% year-on-year (YoY) in Q3 FY25 to ₹832.13 crore from ₹601.61 crore posted in Q3 FY24.

The company’s earnings before interest, tax, depreciation and amortisation (EBITDA) in Q3 FY25 jumped 7% to ₹127 crore from ₹119 crore. Its EBITDA margin dropped to 15.3% as compared to 19.8% in the year-ago quarter.