BHEL Bleeds Post Q1! Maharatna PSU Crashes 6% On Rs 455 Cr Loss: Buy Or Exit ? Check Target Price

BHEL Share Price Today: Shares of Bharat Heavy Electricals Limited crashed nearly 6% after the public sector undertaking reported a net loss of Rs 455 crore in the first quarter of financial year 2025-26.

BHEL shares crashed nearly 3.5% during the pre-market opening and made a weak start during the opening trade. BHEl stock was trading 5.63% lower at Rs 226.15 per share on BSE on Thursday at 10:20 am. The Maharatna PSU stock's market capitalisation stood at Rs 29,339.84 crore.

The turbulent trajectory of the BHEL stock is the result of widening of losses in the June quarter. BHEL's net loss increased from Rs 211.4 crore in Q1FY25 to Rs 455 crore in Q1Fy26.

BHEL Q1 Review

BHEL reported muted Q1FY26 results primarily due to subdued execution (broadly flat YoY) at INR54.9bn while higher other opex dragged OPM to -9.8% (-3.1% in Q1FY25). A healthy uptick in order inflows reported at INR134bn (42% YoY) inched up the backlog to INR2.04tn (7.2x FY25 sales). During the quarter, BHEL successfully commissioned 3x660MW North Karanpura STPS in Jharkhand.

BHEL reported a disappointing result with largely flat YoY revenue growth at INR54.9bn for the quarter. GM also remained largely flat YoY at 29.2% while OPM dipped 670bp YoY to (-9.8%) on higher other opex (+98% YoY). PAT loss was INR4.5bn (versus INR2.1bn loss in Q1FY25) with PAT margin down 440bp YoY to (-8.3%). Other income inched up 68.7% YoY to INR1.9bn. Fresh order inflows jumped

BHEL reported a weak June quarter performance because of subdued execution and higher opex. However, the Maharatna PSU showcased a healthy uptick in order inflows and the company even managed to successfully commission 3x660MW North Karanpura STPS in Jharkhand.

Despite, this BHEL's revenue and profit margins were below the expectations, according to Nuvama Institutional equities. "We reckon EPS shall be INR13.4 by FY27E (versus INR1.5 in FY25) on the back of INR2tn-plus backlog (~80% power mix) and another 25-30GW in pipeline over 18-36 months. We build-in delayed execution as new TPPs' orders won over last 18 months shall be executed by FY27; hence, we envisage 6.5%/11.5% OPM over FY26E/27E versus previous cycle's peak of ~20%," noted the brokerage in its report.

BHEL Share Price Target

Despite BHEL's massive loss in the Q1FY26, the brokerage maintained a 'Buy' rating for the Maharatna PSU stock considering strong order flow and its monopoly in the segment. "We retain 'BUY' as the ongoing streak of fresh orders reaffirms our thesis of a thermal revival, wherein BHEL may benefit from a near monopoly (90%+ market share), implying it may win another ~17GW over next two-three years. We factor in execution spill-over and cut FY26E/27E EPS by ~15%/5%, yielding a TP of INR335 (earlier INR360)," read Nuvama's report released on Thursday.

Antique Stock Broking has also maintained a 'Buy' rating for the PSU stock. "We retain the TP of INR 300 as we roll over our exit multiple of 26x 1HFY28."

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