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Today's prices ask more of Bharat Electronics than of Larsen & Toubro.
At current prices, buyers of Bharat Electronics are assuming about 25% growth against 16% in its own record; for Larsen & Toubro it is 6% against 16%. That shows which share needs more to go right — not which is cheaper. How far each trades from its estimated fair value is in the full valuations.
- Valuation method: Bharat Electronics on discounted cash flow; Larsen & Toubro on estimate withheld.
- Size: Larsen & Toubro is worth about 1.9 times Bharat Electronics on the stock market.
- Record: On revenue the two have grown at much the same pace: Bharat Electronics compounded at about 13% a year (FY2018–FY2026) and Larsen & Toubro at about 11% (FY2018–FY2026).
- What to watch: order inflow at Bharat Electronics; order inflow and backlog at Larsen & Toubro.
| Bharat Electronics | Larsen & Toubro | |
|---|---|---|
| Price | ₹401 | ₹4,144 |
| Market cap | ₹2.93L Cr | ₹5.70L Cr |
| P/E | 45.8 | 31.9 |
| P/B | 12.21 | 5.22 |
| Fair value 🔒 sign in | ₹0,000 | ₹0,000 |
| Upside 🔒 sign in | +00% | +00% |
| Valued on | Discounted cash flow | Estimate withheld |
01Two businesses
The electronics inside India's defence
Bharat Electronics (BEL) is a state-owned defence electronics company based in Bengaluru and majority-owned by the Government of India. It makes radars, sonars, communication systems, electronic-warfare suites and the electronics for missile systems such as Akash.
Engineer, builder, IT house and lender
Larsen & Toubro is India's largest engineering and construction company. Its core business wins and delivers large projects — roads, metros, airports, water systems, power transmission, and oil and gas facilities in India and the Middle East. Its hi-tech manufacturing arm makes heavy equipment and defence systems.
02The records side by side
On revenue the two have grown at much the same pace: Bharat Electronics compounded at about 13% a year (FY2018–FY2026) and Larsen & Toubro at about 11% (FY2018–FY2026). By revenue, Larsen & Toubro is about 10.4 times the size of Bharat Electronics. Bharat Electronics kept 22.0% of revenue as net profit in FY2026; Larsen & Toubro kept 6.6% of revenue as net profit in FY2026 — a sign of very different business models.
Full ten-year tables and charts are on each company's page: Bharat Electronics · Larsen & Toubro.
03What each price assumes
Work backwards from each share price and you can see what buyers are taking for granted — the rate each company must sustain to justify what it costs, against what its own record supports.
04What decides each one's value
- Order inflowNew defence orders set revenue for years ahead.
- MarginsRising localisation and scale have lifted margins steadily.
- Order inflow and backlogMost of L&T's revenue for the next few years is already in its order book. The size and margin of new orders set future earnings.
- Execution marginsConstruction margins are thin, so cost overruns or commodity swings move profit by much more than they move revenue.
05What could go wrong
- One customerRevenue depends on India's defence budget and procurement.
- Order timingLarge orders can slip from one year to the next.
- A slowdown in public capexGovernment infrastructure spending is the biggest single source of domestic orders.
- Working capitalDelayed client payments tie up cash and can strain the balance sheet.
06Which is better value?
Sign in free to see which trades further below its worth
- ✓Both fair values per share — each on the method that fits the business
- ✓Every step of both workings — growth, margins and cost of capital, with sources
- ✓Bull, base and bear cases — for each company
- ✓Downloadable reports — the full write-up for each, yours to keep
08Questions people ask
Is Bharat Electronics or Larsen & Toubro better value?
That turns on how far each share trades from its estimated fair value. Both figures, with every step of the working, are in the full valuations, free to view once you sign in. On the public numbers, Bharat Electronics trades at 45.8 times earnings and 12.21 times book value, and Larsen & Toubro at 31.9 times earnings and 5.22 times book value — but multiples alone mislead when two businesses work differently, which is why each is valued on the method that fits it.
What is the difference between Bharat Electronics and Larsen & Toubro?
Bharat Electronics (BEL) is a state-owned defence electronics company based in Bengaluru and majority-owned by the Government of India. Larsen & Toubro is India's largest engineering and construction company.
Are Bharat Electronics and Larsen & Toubro valued the same way?
No. Bharat Electronics is valued on discounted cash flow and Larsen & Toubro on estimate withheld, because forcing one model onto both would misstate at least one of them.
What does today's price assume for Bharat Electronics and Larsen & Toubro?
Worked backwards from the share price, Bharat Electronics needs about 25% growth and Larsen & Toubro about 6% growth, against 16% and 16% in their own records.