Analysts retain optimism in Bharat Electronics Ltd. even as shares of the state-run maker of radars to aerospace electronics fell to their lowest in nearly three years after the Ministry of Defence lowered margins on orders.

The stock plunged more than 27 percent in the last one month. That came after the ministry said margins on new orders will be 7.5 percent against 12.5 percent earlier. The counter now trades at 14.94 times its trailing 12-month price to earnings ratio, making it the cheapest defence stock in the world, according to Bloomberg.

Still, brokerages remain bullish. Nineteen of the 23 analysts tracking the stock have a ‘Buy’ rating — highest for any other defence stock in the world. The consensus return potential is nearly 46 percent, the most for a defence company in the world.

The new pricing guidelines, which will not apply to orders like long-range surface-to-air and Akash missiles, is prospective in nature and will not have any impact on the company’s current order book worth over Rs 50,000 crore, Citi said in a note. Antique Broking remains bullish, estimating earnings to grow at 10 percent annualised rate even as margins could fall to 16 percent in five years through March 2023.