Key Takeaways
- BHEL swung to a consolidated net profit of Rs 376.71 crore in Q1 FY27, against a loss of Rs 455.50 crore a year ago, its first June-quarter profit since FY19.
- Revenue from operations jumped 40.3% YoY to Rs 7,697.72 crore, led by a sharp turnaround in the power segment.
- Shares touched a fresh 52-week high of Rs 446.50 last week before some profit-booking; the stock is still up over 67% in the past year.
- ICICI Securities raised its target to Rs 520 (from Rs 450); JM Financial kept its target at Rs 481 and named BHEL a top-5 sector pick.
- Not all brokerages are equally bullish, a few global houses remain cautious on valuation after the stock’s sharp run-up.
Why Today?
BHEL stock is back in the spotlight because the market is still digesting the fallout of last Thursday’s earnings surprise. The Maharatna PSU’s return to profitability, its first in eight years for the June quarter, triggered a wave of brokerage notes, a fresh 52-week high, and renewed foreign portfolio investor buying. With the stock still trading within striking distance of that high and analyst target prices ranging widely, investors are asking whether this rally has legs or has already priced in the good news.
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The Q1 FY27 Scorecard: Numbers Behind the Turnaround
According to BHEL’s exchange filing, the state-run engineering major reported a consolidated net profit of Rs 376.71 crore for the April–June 2026 quarter, reversing a net loss of Rs 455.50 crore in the same period last year. Revenue from operations climbed 40.3% year-on-year to Rs 7,697.72 crore, while total income rose to Rs 7,911.86 crore. Earnings per share came in at Rs 1.08, against a loss per share of Rs 1.31 in Q1 FY26.
| Metric | Q1 FY27 | Q1 FY26 | YoY Change |
|---|---|---|---|
| Revenue from Operations | Rs 7,697.72 cr | Rs 5,486.91 cr | +40.3% |
| Net Profit / (Loss) | Rs 376.71 cr | (Rs 455.50 cr) | Turnaround |
| Total Income | Rs 7,911.86 cr | Rs 5,658.07 cr | +39.8% |
| EPS | Rs 1.08 | (Rs 1.31) | Turnaround |
| PAT Margin | 4.89% | Negative | Turnaround |
The bulk of the recovery came from BHEL’s core power segment, where revenue jumped nearly 52% YoY to Rs 5,919.50 crore, per the filing, as the business swung from a loss to a healthy profit at the segment level. The industry segment, by comparison, grew a more modest 12% YoY.
Order Book Strength Is the Bigger Story
Brokerages argue the June-quarter numbers aren’t a one-off. ICICI Securities noted that BHEL has bagged close to Rs 2.7 lakh crore of fresh orders over the last three years, taking its total order book to roughly Rs 2.6 lakh crore, about 7.2 times trailing twelve-month sales. The brokerage attributed the margin improvement to newer, better-priced contracts entering execution, replacing older low-margin legacy orders, and expects execution to grow at a low-double-digit pace through FY28.
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ICICI Securities: Buy, Target Raised to Rs 520
ICICI Securities retained its “Buy” call on BHEL and raised its target price to Rs 520 from Rs 450 earlier, implying an upside of roughly 23% from the stock’s pre-result closing level of about Rs 422. The brokerage’s revised target values the stock on expectations of steady execution growth and further margin gains as the order mix keeps shifting toward higher-realisation projects.
JM Financial: Rs 481 Target, Names BHEL a Top-5 Pick
JM Financial also flagged this as BHEL’s first profitable June quarter in eight years, pointing to a roughly 200-basis-point YoY improvement in gross margin to around 31%, alongside a sharp recovery in EBITDA margin to about 6.5%.
The brokerage kept its “Buy” rating and an unchanged target of Rs 481, valuing the stock at 30 times its September 2028 estimated earnings.
JM Financial listed BHEL among its top five sector picks, noting that the industry’s original 97-gigawatt thermal capacity addition target has now expanded to more than 110 gigawatts, a tailwind for order inflows.
Not Every Brokerage Is Convinced
The bullish view isn’t universal. Some global brokerages remain cautious after the stock’s sharp rally, arguing valuations already reflect much of the turnaround story.
| Brokerage | Rating | Target Price |
|---|---|---|
| ICICI Securities | Buy | Rs 520 |
| JM Financial | Buy | Rs 481 |
| IIFL Securities | Add | Rs 502 |
| Morgan Stanley | Overweight | Rs 444 |
| UBS | Neutral | Rs 460 |
| Macquarie | Underperform | Rs 315 |
| CLSA | Reduce | Rs 306 |
Analyst targets across brokerages currently span a wide Rs 306–537 range, underlining a genuine debate on the Street about how much of BHEL’s turnaround is structural versus cyclical.
Stock Price Action
BHEL shares touched a fresh 52-week high of Rs 446.50 last week before easing on profit-booking. As of Monday morning, the stock was trading around Rs 420–425 on the NSE and BSE, with a market capitalisation of roughly Rs 1.47 lakh crore. Over the past year, the stock has gained more than 67%, rebounding sharply from its 52-week low of Rs 205.12 touched earlier in the cycle.
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What Investors Should Watch
Execution pace on the existing order book, the pace of new order inflows in the thermal and industrial segments, and margin trends in the coming quarters will likely decide whether BHEL sustains this re-rating or gives back some gains, given how far the stock has already run in 2026.
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Frequently Asked Questions
Q1. Why did BHEL shares hit a 52-week high?
BHEL shares rallied to Rs 446.50, a fresh 52-week high, after the company reported its first June-quarter profit in eight years, with revenue up over 40% year-on-year.
Q2. What is BHEL’s target price according to brokerages?
Target prices vary widely, ICICI Securities has set Rs 520, JM Financial Rs 481, while some brokerages like Macquarie and CLSA have lower targets in the Rs 300–320 range, reflecting differing views on valuation.
Q3. Is BHEL a good stock to buy after Q1 FY27 results?
Brokerage views are mixed. Buy-rated brokerages point to order book strength and margin improvement, while more cautious houses flag stretched valuations after the stock’s sharp one-year rally. Investors should weigh both views against their own risk appetite.
Q4. What drove BHEL’s profit turnaround in Q1 FY27?
A sharp recovery in the power segment, better-priced new orders entering execution, and operating leverage from higher revenue all contributed to the swing from loss to profit.
Q5. What is BHEL’s current order book size?
BHEL’s order book stood at approximately Rs 2.6 lakh crore as of Q1 FY27, according to ICICI Securities, aided by roughly Rs 2.7 lakh crore of fresh orders won over the past three years.
Disclaimer
This article is for informational purposes only and should not be construed as investment advice. Stock market investments are subject to market risks. Brokerage recommendations and target prices reflect the views of the respective firms and not of NiftyTrader. Readers are advised to consult a registered financial advisor before making any investment decisions.
