* Bharat Electronics (BHE) has received an offset contract from Elbit Systems for supply of 10 units of CoMPASS systems for use in the light combat helicopters being manufactured by HAL.
* BHE has launched a remote-controlled weapon system for MBT Arjun MK II, a weapon control system for 12.7mm gun of MBT Arjun MK II battle tank.
* BHE registered provisional revenue of INR88b in FY17, led by execution of key orders in hand, like Akash missile, WLR, hand-held thermal device, tactical control radar, etc.
* BHE plans to explore opportunities in critical infrastructure protection, air traffic management radars, intelligent traffic management systems, solar power plants and smart city elements.
* BHE has planned capex of INR23b over the next five years toward modernization and expansion of existing facilities to support the government’s “Make in India” initiative. Majority of the capex would be spent on developing BMS test bed, TCS test bed, test bed for missile system, etc. Maintain Buy.
Key issues to watch
* Revenue growth: Key orders (Akash missile, intake of INR67b in FY11–12) are currently under execution for Army and Air Force.
* Operating at 60% capacity utilization; possibility of strong operating leverage.
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