BHEL Q2 PAT seen down 40% at Rs 760cr: KR Choksey

KR Choksey has come out with its second quarter (July-September) earnings estimates for the capital goods sector. The brokerage house expects Bharat Heavy Electricals (BHEL) to report a 63 percent growth quarter-on-quarter (down 40 percent Y-o-Y) in net profit at Rs 760 crore.

Sales of Bharat Heavy Electricals are expected to increase by 33 percent Q-o-Q (down 19 percent Y-o-Y) to Rs 8,608 crore, according to KR Choksey.

Earnings before interest, tax, depreciation and amortisation (EBITDA) are likely to rise by 171 percent Q-o-Q (down 45 percent Y-o-Y) to Rs 1,052 crore.

EBITDA margin or operating profit margin is likely to be at 12.2 percent in September quarter as against 6 percent in June quarter and 18 percent in a year ago period.

KR Choksey's Report on Bharat Heavy Electricals:

We expect BHEL to register subdued growth in sales as customers are deferring payment due to financial stress. Company's cash over revenue policy and lull in order inflows to also impact growth.

Lower operating leverage to impact EBIDTA margins and consequently lead to decline in earnings.

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