BHEL gets a price target cut from Nuvama despite stellar Q4 earnings show; here’s why 

BHEL share price: Shares of Bharat Heavy Electricals Ltd (BHEL) are in a bull run with the stock rising 60% in three months and scaling a 52-week high amid soaring volatility in the broader market. However, BHEL shares have received a price target cut from brokerage Nuvama despite Q4 earnings beat estimates. Nuvama said BHEL’s order backlog has risen to Rs 73,900 crore and cut FY27E/28E earnings per share (EPS) by 7% aligning execution with management guidance (2.7x FY26 sales). The brokerage valued the stock at 45 times FY28E EPS yields a target price of Rs 485 against Rs 525 earlier). 

ICICI Securities also cited a delay in execution of the current backlog adversely affecting the margins as a key risk to its bullish outlook. It assigned a price target of Rs 460 to the PSU major. 

On Wednesday, the PSU multibagger stock ended 1.85% higher at Rs 408.45 against the previous close of Rs 401.05. Market cap of the firm stood at Rs 1.42 lakh crore. Total 6.28 lakh shares of the firm changed hands amounting to a turnover of Rs 25.36 crore. 

The PSU stock is overbought on charts with a RSI of 71.1. The multibagger stock gained 410% in three years and zoomed 463% in five years. 

The BHEL stock appears strong in terms of price action as it trades higher than the 5 day, 10 day, 20 day, 50 day, 100 day and 200 day simple moving averages. 

The management has guided for 15% plus revenue growth, 28% plus EBITDA margin and Rs 1,200 crore capex. In Q4 of the previous fiscal, net profit zoomed 156% to Rs 1,290 crore for the January-to-March quarter compared to Rs 504 crore in the corresponding period of the previous fiscal year.

Revenue from operations surged 37% year-on-year (YoY) to Rs 12,310 crore in Q4 FY26 against Rs 8,993 crore in the corresponding quarter of the previous financial year.

Earnings before interest, taxes, depreciation, and amortisation (EBITDA) came at Rs 1,753 crore in Q4 against Rs 831 crore in Q4 FY25. EBITDA margins expanded to 14.24% in the reporting quarter as compared to 9.24% YoY.