Rs 1,60,157 Crore Order Book Multibagger Stock: LIC and Government Backed Heavy Electrical Equipment Company Signs a Pivotal 10-year MoU with Nuovo Pignone International

With a PE ratio of 142, the company trades at a premium compared to the industry PE of 44.4. The company has a ROCE of 3.37 per cent and an ROE of 1.13 per cent.

Bharat Heavy Electricals Limited (BHEL) has announced a significant strategic move by entering into a Memorandum of Understanding (MoU) with M/s Nuovo Pignone International s.r.l. The core objective of this collaboration is to pursue and capitalize on compressor revamp opportunities within the fertilizer sector across India.  

Under the terms of the agreement, BHEL will assume the role of the primary bidder when engaging with potential customers, while Nuovo Pignone International s.r.l. will participate as the nominated vendor, contributing with a clearly defined scope of work. The strategic alliance between the two entities does not involve the creation of any new joint venture or entity; instead, it is structured as a business-sharing arrangement. Financial details of the MoU specify that there are no upfront payments between the parties, and each will be responsible for the expenses incurred within their respective areas of responsibility.  

The MoU, officially signed on April 9, 2025, is set to remain in effect for a period of ten years from the effective date or until both parties mutually agree to its continuation, whichever transpires earlier. This collaboration is poised to offer substantial benefits, particularly for BHEL, which anticipates securing approximately 50 per cent of the financial share in the compressor revamp opportunities within the fertiliser sector. Furthermore, BHEL projects that this strategic tie-up will enhance its market presence and share in the fertiliser sector's repair and maintenance business.

As of April 10, 2025, BHEL's stock was traded at Rs 212. The stock has a 52-week high of Rs 329.25 and a 52-week low of Rs 178.9. This multibagger stock has delivered impressive 885 per cent returns over the past 5 years.

Bharat Heavy Electricals Ltd is a leading power plant equipment manufacturer in India, with a strong presence in the power, industry, and renewable energy sectors. The company, owned by the Government of India, has a vast installed base of electricity utility projects, contributing significantly to the nation's power capacity. BHEL's product offerings include steam generators, turbines, and power plants, catering to various industries. The company is actively pursuing strategic initiatives, such as entering the coal gasification sector and expanding its hydrogen business. With a robust order book and a focus on technological advancements, BHEL is well-positioned to maintain its leadership in the engineering and manufacturing space.

BHEL has a market capitalisation of Rs 73,754 crore. The stock has delivered a 3-year return of 307.2 per cent but has seen a 1-year return of -8.16 per cent.

With a PE ratio of 142, the company trades at a premium compared to the industry PE of 44.4. The company has a ROCE of 3.37 per cent and an ROE of 1.13 per cent.

Investors must keep this Large-Cap PSU stock on their radar.

Disclaimer: The article is for informational purposes only and not investment advice.