Bharat Dynamics revenue jumps 45% as quarterly profit falls 15%

Bharat Dynamics Limited reported revenue from operations of Rs 1,664.14 crore for the quarter ended September 30, 2026, up 45% year on year, while net profit fell 15% to Rs 183.48 crore as total expenses increased to Rs 1,585.05 crore.

What changed in Bharat Dynamics' September-quarter revenue?

Bharat Dynamics' revenue from operations rose by Rs 517.11 crore year on year to Rs 1,664.14 crore in the September 2026 quarter. Sales income was Rs 1,644.16 crore and other operating income was Rs 19.98 crore, compared with total revenue from operations of Rs 1,147.03 crore in the September 2025 quarter.

Total income, which includes other income, increased to Rs 1,831.21 crore from Rs 1,267.60 crore a year earlier. Other income was Rs 167.07 crore in the latest quarter, compared with Rs 120.57 crore in the September 2025 quarter, contributing Rs 46.50 crore to the year-on-year increase.

Revenue from operations was also above Rs 572.24 crore reported in the preceding quarter ended June 30, 2026. For the half year ended September 30, 2026, revenue from operations reached Rs 2,236.38 crore, compared with Rs 1,394.96 crore in the corresponding 2025 half year.

Bharat Dynamics does not provide a product or business revenue split in this filing because government companies engaged in defence production are exempt from segment reporting under a Ministry of Corporate Affairs notification. The half-year revenue total comprised Rs 2,209.90 crore of sales income and Rs 26.48 crore of other operating income.

Why did Bharat Dynamics' profit fall despite higher revenue?

Bharat Dynamics' September-quarter profit fell because total expenses rose by Rs 605.07 crore, exceeding the Rs 563.61 crore increase in total income. Profit before tax declined to Rs 246.16 crore from Rs 287.61 crore, and tax expense decreased to Rs 62.67 crore from Rs 71.73 crore.

The largest stated movement was in changes in inventories of finished goods and work-in-progress, which became an expense of Rs 945.04 crore in the latest quarter from a reduction of Rs 130.46 crore in the September 2025 quarter. This shift added Rs 1,075.50 crore to expenses on a year-on-year comparison.

Cost of materials consumed declined to Rs 391.51 crore from Rs 781.66 crore, while employee benefits expense fell to Rs 127.75 crore from Rs 162.39 crore. Depreciation and amortisation expense nevertheless increased to Rs 21.11 crore from Rs 19.12 crore, and other expenses declined to Rs 98.76 crore from Rs 145.93 crore.

For the half year ended September 30, 2026, Bharat Dynamics reported net profit of Rs 302.27 crore, up from Rs 234.23 crore in the corresponding prior-year period. Half-year total income rose to Rs 2,506.88 crore from Rs 1,802.39 crore, showing that the quarterly profit decline occurred despite higher cumulative first-half profit.

What does Bharat Dynamics' half-year cash flow show?

Bharat Dynamics generated net cash from operating activities of Rs 1,161.58 crore in the half year ended September 30, 2026, compared with net cash used in operations of Rs 80.27 crore in the corresponding 2025 period. Operating profit before working-capital changes increased to Rs 259.50 crore from Rs 197.50 crore.

The cash-flow statement recorded increases of Rs 196.20 crore in trade receivables, Rs 246.75 crore in other financial assets and Rs 65.67 crore in inventories during the latest half year. Other assets increased by Rs 432.90 crore, while other liabilities increased by Rs 190.66 crore.

Investing activities used Rs 1,075.93 crore in the six months to September 30, 2026, compared with an inflow of Rs 532.43 crore in the prior-year period. Bank deposits used Rs 1,127 crore in the latest period, whereas bank deposits contributed Rs 457.01 crore in the September 2025 half year; purchases of property, plant, equipment and intangible assets were Rs 72.86 crore.

Financing activities used Rs 1.68 crore in the latest half year, including Rs 0.81 crore of lease-liability repayments and Rs 0.82 crore of finance costs. The combined cash flows resulted in a Rs 83.98 crore increase in cash and cash equivalents, compared with an increase of Rs 448.29 crore in the prior-year half.

How did Bharat Dynamics' balance sheet and inventory position change?

Bharat Dynamics' total assets increased to Rs 16,557.70 crore as of September 30, 2026, from Rs 14,261.50 crore as of March 31, 2026. Total liabilities rose to Rs 12,030.81 crore from Rs 10,020.53 crore, while total equity increased to Rs 4,526.90 crore from Rs 4,240.97 crore.

Current assets rose to Rs 15,002.39 crore from Rs 12,756.97 crore over the six months. Bank balances other than cash equivalents increased to Rs 4,973 crore from Rs 3,846 crore, trade receivables rose to Rs 619.07 crore from Rs 422.88 crore, and other financial assets increased to Rs 775.66 crore from Rs 480.06 crore.

Inventories stood at Rs 4,684.99 crore on September 30, 2026, compared with Rs 4,625.64 crore at March 31, 2026. The filing separately identified Rs 83.27 crore of inventory that had not moved for more than five years, unchanged from March 31, 2026, relating to customer orders or letters of intent subsequently short-closed.

Bharat Dynamics said it had received Rs 362.34 crore of advances against the contracts connected to the non-moving inventory. The auditor drew attention to the matter without modifying its limited-review conclusion, noting that Bharat Dynamics had not considered a redundancy provision necessary because the advances exceeded the assets acquired and related expenditure.

Conclusion

Bharat Dynamics delivered higher September-quarter revenue and higher half-year net profit, but its quarterly net profit fell as the inventory movement changed from a Rs 130.46 crore reduction in September 2025 to a Rs 945.04 crore expense in September 2026. Operating cash flow also moved to an inflow of Rs 1,161.58 crore from an outflow of Rs 80.27 crore a year earlier.

The unresolved item to watch in subsequent disclosures is the Rs 83.27 crore of inventory that has remained non-moving for more than five years, alongside Rs 362.34 crore of related customer advances. Bharat Dynamics' September 30, 2026 balance sheet also showed trade receivables of Rs 619.07 crore and other financial assets of Rs 775.66 crore, both higher than at March 31, 2026.