The shares of this PSU company jumped around 3 percent in Wednesday’s trading session after signing an MoU with the Indian Navy to Boost Indigenous Marine Engineering. In one year, the stock has delivered more than 80 percent return to its shareholders.
Price Movement:
With a market capitalization of Rs. 16,115 crores, the shares of BEML Ltd started Wednesday’s trading session on a higher note at Rs. 3,800 compared to its previous close of Rs. 3,768.90. During the trading session, the shares hit a high of Rs. 3,919, gaining around 3 percent and are currently trading at Rs. 3,853 apiece.
What Happened:
On 20th August, BEML Ltd, one of India’s leading Defence and Heavy Engineering manufacturers signed a Memorandum of Understanding (MoU) with the Directorate of Marine Engineering, Indian Navy, for indigenous design, development, manufacture, testing, and product support of critical marine equipment and systems.
The MoU was concluded at the Naval Headquarters at New Delhi between Rear Admiral K Srinivas, ACOM(D&R), Indian Navy and Shri Ajit Kumar Srivastav, Director of Defence, BEML.
Aligned with the Government of India’s Aatmanirbhar Bharat initiative, the partnership aims to strengthen self-reliance in defence production and reduce dependence on foreign OEMs.
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“This landmark agreement is a pivotal step in enhancing bilateral cooperation for the indigenous design, development, manufacture, testing, and product support of critical marine equipment and systems,” the PSU company said in a statement.
The partnership aims to bolster self-reliance in defence production and reduce dependence on foreign imports, according to the firm.
Furthermore, the company stated that the collaboration will enhance indigenous marine engineering capabilities, ensuring that both current and future naval projects are equipped with state-of-the-art, domestically produced technology.
This alliance is focused on meeting immediate operational requirements while also fortifying long-term defence infrastructure, it added.
Financials:
Looking at the company’s financial statements, the revenue decreased by 58 percent from Rs. 1,514 crores during the March quarter to Rs. 634 crores in the June quarter. On the other hand, the net profits showcased a transition from a net profit of Rs. 257 crores to a net loss of Rs. 70 crores during the same period.
Order Book:
As per the latest data, the company has an order book of Rs. 11,872 crores and further expects major impetus to come from the railway and metro train sectors, with plans to secure a good chunk of the upcoming orders for 500-600 Vande Bharat trains.
Important Financial Ratios:
In terms of key financial metrics, the company reported a Return on Equity (RoE) of 10.56 percent and a return on capital employed (RoCE) of 11.82 percent for the period spanning FY22-23. Additionally, the net profit margin stood at 6.94 percent during the same timeframe.
Company Profile:
BEML Ltd manufactures a wide range of heavy earthmoving equipment catering to the mining and construction industry, vehicles for defence forces and coaches for the metro and Indian Railways.
Written By Vaibhav Patil
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