PSU stock Bharat Heavy Electricals Limited (NSE: BHEL) rose over 14% intraday today, crossing its 52-week high. The stock has returned over 1200% in the past four years rising from ₹20 in 2020 to ₹269 in 2024.
BHEL primarily works in the construction, design and maintenance of transmission lines, defence, infrastructure, etc. These sectors in India have performed quite well as the economy sores up.
If we compare BHEL’s return to that of Nifty 50, in the last 12 months, Bharat Heavy Electricals have gained over 140% whereas Nifty was at a moderate 20% gain. Now the company is in talks of getting another big order which can fuel its bullish momentum even further.
BHEL is rising as its finances improve
PSU stock BHEL has displayed improving fundamentals with its better Returns on equity. The company has also improved its sales number, which grew by 10% in the last quarter compared to the previous year.
The industrial equipment manufacturer has also attracted Foreign Institutional Investors, who have raised their stakes by 1.4% in the last quarter. Insurance companies are also highly invested in BHEL with a shareholding of approx 10%
Bharat Heavy Electricals also pays dividends regularly which makes it attractive to long-term investors, as investors can earn a little extra ‘dividend income’
Big order wins for BHEL helping it grow
In the last two months, BHEL received two big orders of over ₹5000 crores. In February, the company bagged an order for an 800 MW thermal power plant from Haryana.
It also secured an order for a 2400 MW project from Odisha. In 2023, the company got a deal worth ₹2242 crores from NHPC which is a major hydro power company in India.
As the power demand in India is at an all time high, BHEL might secure more such orders in future for its power generation equipment which the company excels in.
Share Details for BHEL
| Measure | Value |
|---|---|
| Market Cap | ₹ 92,570.65 Cr. |
| Enterprise Value | ₹ 91,313.07 Cr. |
| Number of Shares | 348.21 Cr. |
| P/B | 3.51 |
| Face Value | ₹ 2 |
| Dividend Yield | 0.17 % |
| Book Value (TTM) | ₹ 75.68 |
Last 5 year sales growth for BHEL
| Time Period | Sales Growth Rate |
|---|---|
| 1 Year | 10.15% |
| 3 Years | 2.88% |
| 5 Years | -4.11% |
Final Words
Initially, if the moment continues, we can expect BHEL to reach targets of ₹325 in the coming months. However, conservative traders should wait for a retest of breakout levels of ₹195 to ₹200. Parabolic moves are generally riskier as stop loss becomes bigger.
Long term investors should keep watch on the company’s fundamentals and study them every quarter. For reference, we have marked long term targets for Bharat Heavy Electricals upto 2030 based on AI.
