Rs 1,60,000 crore order book: Heavy electrical equipment stock hit upper circuit as company reports a turnaround net profit in Q2FY25

From Rs 117.45 (52-week low) to Rs 229.80 per share, the stock is up by 95.65 per cent.

On Monday, shares of this multibagger heavy electrical equipment company hit a 10 per cent upper circuit to Rs 238.60 per share from its previous closing of Rs 216.95. The stock’s 52-week high is Rs 335.40 and its 52-week low is Rs 117.45. At the closing bell, shares of the company were trading at Rs 229.80 per share, up 5.92 per cent with a spurt in volume by more than 3 times on BSE.

The stock name is Bharat Heavy Electricals Ltd (BHEL).

BHEL, a leading public sector enterprise under the Ministry of Heavy Industries and Public Enterprises, has been at the forefront of India's power sector for over six decades. With a strong track record in the design, engineering, and manufacturing of a wide range of power generation equipment, BHEL has played a pivotal role in powering the nation's economic growth. BHEL Limited manufactures various power plant equipment.

Bharat Heavy Electricals Limited (BHEL) announced mixed sets of numbers in its Quarterly Results (Q2FY25) and half-yearly results (H1FY25). According to quarterly results, the net sales increased by 28.5 per cent to Rs 6,584.10 crore in Q2FY25 compared to Q2FY24. The company reported a net profit of Rs 89.53 crore in Q2FY25 compared to a net loss of Rs 74.96 crore in Q2FY24, an increase of 219.4 per cent. In its half-yearly results, the company reported net sales of Rs 12,069 crore and a net loss of Rs 136 crore in H2FY25 while in its annual results, the company reported net sales of Rs 23,893 crore and a net profit of Rs 218.24 crore in FY24.

BHEL has made significant strides in technological advancement and manufacturing capabilities. They have successfully designed, manufactured, and tested a 200 kW High-Temperature Superconducting (HTSC) motor, a first-of-its-kind achievement in India. The company has also set new benchmarks in hydropower, with the largest and highest-rated vertical Kaplan runner for the Polavaram Hydroelectric Project. In the field of energy efficiency, BHEL has commissioned high-capacity power plants and supplied critical components like steam generators for nuclear power plants. Additionally, the company has forayed into emerging technologies like electric mobility with the development of high-power axial flux permanent magnet motors. These achievements demonstrate BHEL's commitment to innovation and its role in driving India's technological progress.

Earlier, the company secured a significant contract from Adani Power Limited and its subsidiary, Mahan Energen Limited, to provide equipment and services for the construction of three supercritical thermal power projects. These projects, located in Kawai, Rajasthan, and Mahan, Madhya Pradesh, will each have a capacity of 1600 MW. The contract agreement, signed on August 25, 2024, covers the supply of boilers, turbines, generators, and associated equipment, as well as the supervision of erection and commissioning. The projects are expected to be completed in 49 months (Kawai Phase-II), 52 months (Kawai Phase-III) and 55 months (Mahan Phase-III). The total value of the three orders exceeds Rs 11,000 crore excluding GST.

The company has a market cap of over Rs 80,000 crore. The President of India’s portfolio owns 63.17 per cent and Life Insurance Corporation of India’s portfolio owns 6.72 per cent as of September 2024. Additionally, FIIs increased their stake to 9.48 per cent in September 2024 compared to 9.10 per cent in June 2024. Furthermore, the company’s order book stands at Rs 1,80,000 crore.

The company has been maintaining a healthy dividend payout of 27.8 per cent. From Rs 117.45 (52-week low) to Rs 229.80 per share, the stock is up by 95.65 per cent. Investors should keep an eye on this PSU stock.

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