BHEL tumbles 5% as Q1 loss widens, but analysts retain 'Buy'; here's why

BHEL share price today: Shares of public sector engineering and manufacturing company Bharat Heavy Electricals (BHEL) fell nearly 5 per cent to hit an intraday low of ₹228.12 on the NSE on Thursday after the company reported a disappointing set of numbers in the June 2025 quarter (Q1FY26).

 

At 9:45 AM, the BHEL stock was trading at ₹229.8, down 4 per cent from the previous day's close of ₹239.83. In comparison, the NSE Nifty50 index was down 67.75 points or 0.28 per cent at 24,506.45 levels.

 

The stock has crashed over 21 per cent from its 52-week high of ₹305.8 touched on August 9, 2024. The company's total market capitalisation stood at ₹80,087.46 crore.   READ STOCK MARKET LIVE UPDATES TODAY

 

BHEL Q1 results

In the June quarter of FY26, BHEL posted consolidated revenue from operations of ₹548.69 crore, broadly flat compared to ₹548.49 crore in the year-ago period. The company's net loss widened to ₹455.5 crore against ₹211.4 crore in the Q1FY25, primarily due to higher expenses. 

 

The company's expenses rose around 7 per cent to ₹6,280 crore, driven by a 10.8 per cent increase in the raw materials and services costs. 

 

In the power segment, the company secured an order for the supply, erection, and commissioning supervision of six 800 MW steam turbine generators. Additionally, BHEL, in consortium with a global OEM, will design and execute 6,000 MW ±800 kV HVDC terminals for the Bhadla–Fatehpur transmission project.  ALSO READ | Lupin shares advance 5% after Q1 results; should you buy in?

Analysts on BHEL Q1 results

BHEL reported muted Q1FY26 results primarily due to subdued execution while higher other operating expenditure dragged operating margin to 9.8 per cent, said Nuvama Institutional Equities. A healthy uptick in order inflows at ₹13,445 crore, up 42 per cent Y-o-Y, increased the backlog to ₹2,04,375 crore. According to analysts, the steady flow of new orders supports the view that the thermal power sector is making a comeback. Since BHEL holds a near monopoly with over 90 per cent market share, it is expected to win around 17 GW of new projects over the next two to three years.

 

Nuvama retained its 'Buy' rating on the stock with a revised target price of 335 from ₹360 per share earlier. 

 

Echoing similar views, analysts at JM Financial said BHEL has bagged 28 GW of the order in the new power capex cycle beginning August 2023. However, the construction at 20 GW of the projects has still not started due to various reasons like lack of customer clearance, availability of land or certain regulatory approvals.

 

JM Financial expects the company's performance to improve in Q3FY26 given the profile of major projects is under construction. 

"As the execution of legacy projects is nearing completion and industry orders-mix improves, Ebitda margin is likely to improve gradually from 4.4 per cent in FY25 to at least 11 per cent in FY28.

 

The brokerage has maintained 'Buy' rating on the stock with an unchanged target price of ₹278.