Strategy to diversify revenue streams away from a constrained domestic defence budget was a key takeaway from Bharat Electronics’ (BEL) analyst meet. BEL does not mind additional capex to achieve the same (10-15% y-o-y capex growth from the likely Rs 5.5 billion in FY21). The idea, if properly executed, can allow BEL to maintain double-digit revenue growth in the foreseeable future; it also underlines the limited headroom the base business offers for continuation of growth, given scale. Maintain ‘hold’ with a revised target price of Rs 102.