Shares of BHEL are now trading at a 52-week high on Friday, July 17, extending gains after Thursday’s 5% upmove after its first quarter results that were reported during market hours.
Since December 31, 2020, the stock has surged more than 1,100% in value.
Nuvama: The Bullish Bet
Brokerage firm Nuvama has raised its price target on BHEL to ₹530 from ₹450 earlier. This is the second-highest price target on the street for the stock.
According to Nuvama’s note, BHEL’s margin recovery is currently underway with the 6.5% margin figure reflecting improved execution.
Given that the legacy low-margin projects are largely behind, an execution ramp-up in financial year 2027 will drive profitability and cash flows for BHEL, Nuvama’s note said.
The brokerage is expecting a revenue Compounded Annual Growth Rate (CAGR) of 26% and Earnings Per Share (EPS) CAGR of 76% over financial year 2026-2028.
Nuvama has valued BHEL at 38 times its financial year 2028 estimated Earnings per Share, compared to 32 times earlier.
BHEL’s Lowest Share Price Target From Kotak
On the flip side, Kotak Institutional Equities had a “sell” rating on the stock with a price target of ₹150, which implies a 67% downside from current levels.
Kotak wrote in its note that the benefits of operating leverage are getting meaningfully amplified by provisional writebacks.
“In our assessment, three drivers of margin improvement are likely to peak or reverse over FY2027-29, which include business per employee, cost per employee, provision cost / writeback),” Kotak’s note stated.
At ₹150, Kotak values BHEL at 12 times one-year forward EPS multiple, adjusted for transient supports like provision reversal and forex support.
JPMorgan Among List Of Bears
The brokerage has an underperform rating on BHEL with a price target of ₹220, despite stating that the first quarter showed improved execution and margins.
JPMorgan’s note stated that the sharp outperformance provides a good exit opportunity in a deeply cyclical name, especially given that the best of the thermal power plant ordering cycle is behind us.
BHEL’s orders could further decline by 12% year-on-year in financial year 2027.
Macquarie Raises Target On BHEL But Remains “Neutral”
Macquarie raised its price target on BHEL to ₹315 but maintained its “neutral” rating on the stock, stating that unless a sustained pick-up in execution is seen, BHEL could face difficulty improving its profitability and therefore, higher receivables remain a challenge
CLSA Remains In List of BHEL Bears
CLSA also has an “underperform” rating on BHEL with a price target of ₹306 citing the “average” quality of growth and the margin expansion was also aided by a 723 basis points lower other expenses and non-cash provisions, along with forex gains.
“BHEL has rallied on short squeeze and energy security theme over the last here months and its driven by El Nino weather.
Calling BHEL’s valuations expensive as the order inflow has peaked in financial year 2025, CLSA said that its rating is driven by the entry of Chinese suppliers, L&T and Thermax into its core thermal equipment segment, questions its market dominance while the stock is pricing in a lot more.
Shares of BHEL are off the day’s high, currently trading 1% higher at ₹439.8.
