PSU stock, Bharat Electronics Ltd (BEL) surged over 5% today during the morning, hitting an intra day high at Rs.1325.45. Profit booking came in at this level and the stock is now ruling at Rs.1290 levels, up over 2.5%.

This aerospace and defence company posted very good set of numbers for Q2FY17. The company reported a 68% (YoY) jump in net profit at Rs.346 crore on a 16% rise in total income at Rs.1795 crore. EBITDA was up 87% at Rs.338 crore and margins rose from 11.71% to 18.83%. Raw material costs fell 10% and total expenses dropped 7%. Employee costs remains a big component, marking 22% of total cost and was up 5% during the quarter and ate away 18% of the total income.  

The company is touted to do well in the coming days, given the Govt’s drive for indigenisation in defence. And the current performance goes on to show that it does have the ability to execute and we could see more improvement in the numbers as orders get firmed. The Govt of India holds 75.01% stake and LIC holds 5.95%. Equity stands at Rs.240 crore (face value Rs.10).