BHEL reported a strong Q2 FY27 performance, with revenue growth of 23.8% YoY and Ebitda margin improving to 11%, supported by higher gross margins. The Power segment remained the key growth driver, registering 17% YoY revenue growth, underpinned by execution of its robust order book of ~ Rs 2.1 trillion. Order wins across hydroelectric projects, including Heo and Tato-I, along with an FR6B gas turbine order, further strengthen its presence across hydro and gas-based power generation.
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PL Capital Report
PL Capital has raised its target price to Rs 426 from Rs 368, but retained its Reduce rating despite strong quarterly performance. The revised target implies approximately 8% downside from the report’s CMP of Rs 464.
BHEL reported a strong Q2 FY27 performance, with revenue growth of 23.8% YoY and Ebitda margin improving to 11%, supported by higher gross margins. The Power segment remained the key growth driver, registering 17% YoY revenue growth, underpinned by execution of its robust order book of ~ Rs 2.1 trillion.
Order wins across hydroelectric projects, including Heo and Tato-I, along with an FR6B gas turbine order, further strengthen its presence across hydro and gas-based power generation.
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BHEL achieved 2,260MW of capacity addition in H1 FY27, against its full-year target of 4,790MW, indicating improving execution momentum.
Overall, improving execution, margin recovery and diversification beyond thermal power strengthen BHEL’s medium-term growth outlook, although timely order conversion and sustained execution momentum remain key monitorables.
The stock is currently trading at P/E of 31.6x/24.0x on FY28E/FY29E. The brokerage rolls forward to Sep’28E and maintain its ‘Reduce’ rating on the stock given recent rally in the stock price, with a target price of Rs 426 fro Rs 368 earlier, valuing the stock at a PE of 25x Sep’28E (25x Mar’28E earlier) factoring in stronger execution
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