BHEL slides 4% on Nifty Next 50 debut; analysts maintain 'buy' on long-term prospects

BHEL's stock price catapulted 111 percent over the past 12 months, more than doubling investors' wealth.

Bharat Heavy Electricals (BHEL) shares sulked in the red during the morning trade on September 30, falling over four percent.

BHEL is one of seven counters that have begin to trade in the Nifty Next 50 index today onwards. The state-owned capital goods player's stock price is likely to see inflows of $47 million following its inclusion into the Nifty Next 50 index.

At 11.20 am, BHEL shares were lower by 3.5 percent on the NSE, quoting Rs 277.45 per share.

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Domestic brokerage expects BHEL to swing into the black from the third quarter of the current fiscal year. "With a growing order book, limited competitive environment and a pick-up in execution, we anticipate BHEL to regain its profitable growth trajectory from Q3FY25," said the brokerage.

According to the brokerage, BHEL is likely to deliver revenue CAGR of 24 percent over FY24-26E. JM Financial maintains a 'buy' call on the counter, with a target price of Rs 361 per share.

"The need to add reliability to the grid has led policymakers to push the pedal on the addition of new thermal power plants. As a result, developers are swiftly finalising and awarding equipment orders," noted ICICI Securities.

As a result, BHEL continues to benefit from an improving outlook for coal-based capacity addition. The brokerage maintained its 'buy' call with an unchanged target price of Rs 370 per share.

As PSUs firms rallied sharply over the past year, BHEL was no expectation. BHEL's stock price catapulted 111 percent over the past 12 months, more than doubling investors' wealth. In comparison, the Nifty 50 has risen around 34 percent during the same time. However, from its 52-week high of Rs 335.35 per share, BHEL shares have corrected 14 percent.

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