Shares of state-run engineering firm Bharat Heavy Electricals Ltd (BHEL) rose to their highest level in six years after the company said it has bagged a Rs 4,000-crore order from Mahan Energen Limited (erstwhile Essar Power MP), a wholly-owned subsidiary of Adani Power Limited.
The multibagger maharatna stock settled 9.76 percent higher at Rs 110.80 apiece on the NSE. So far in 2023, BHEL shares have gained 38.24 percent and have risen 108.86 percent in the last one-year period.
As per the order, BHEL would be supplying equipment such as boiler, turbine and generator and offer supervision of erection and commissioning for the 2x800 MW power project based on supercritical technology at Bandhaura, Madhya Pradesh.
"Boiler and turbine generator are to be manufactured at BHEL’s Trichy and Haridwar plants, respectively," the company said. The supply of unit-1 will take 31 months while the unit-2 would take 35 months to be executed.
Amit Anwani, Research Analyst at Prabhudas Lilladher, said the pickup in thermal power orders and companies' focus on diversification in segments such as railways, defence, nuclear, hydro augurs well for BHEL in the long term.
At the prevailing valuations, the stock trades at 40.4 times estimated FY24 earnings per share and 22.4 times the estimate of FY25 EPS. The brokerage has kept its 'Reduce' rating on the stock with a target price of Rs 67.
Earlier in July, BHEL had achieved a major milestone with the successful synchronisation of the 660-MW Unit-2 of the 1,320-MW Maitree Super Thermal Power Project (STPP) in Bangladesh.
The state-run engineering firm reported the widening of its consolidated net loss to Rs 343.89 crore in the April-June quarter compared to the year-ago period mainly due to higher expenses.
The total expenses of the company rose to Rs 5,595.47 crore in the quarter from Rs 5,006.50 crore in the same period a year ago.
The total income of the company rose to Rs 5,117.20 crore in the quarter from Rs 4,742.28 crore in the same period a year ago.
(Edited by : Shoma Bhattacharjee)
First Published: Aug 22, 2023 5:07 PM IST
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