Heavy electrical equipment maker gains 4% on Rs 300 crore-order deal

Shares of Bharat Heavy Electricals Ltd (BHEL) rose over four percent on January 20 in reaction to the development of the company bagging a Rs 300 crore-order. The heavy electrical equipment manufacturer won an order for the renovation & modernisation (R&M) of steam turbines at Ukai Thermal Power Station (TPS) in Gujarat.

At 11:54 am, shares of the company were trading at Rs 81.95 on the BSE, up 2.5 percent.

The order for R&M of the 200 MW Unit-3 and the 210 MW Unit-5 has been placed on BHEL by Gujarat State Electricity Corporation Ltd.

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“Significantly, BHEL is also the Original Equipment Manufacturer (OEM) of these turbine sets which have been successfully operating for around 40 years, before being taken up for R&M,” the company said in an exchange filing.

The company will work on the design, engineering, manufacturing, supply, dismantling, erection, testing and commissioning of the steam turbines and associated auxiliaries.

Further, the equipment for the project will be supplied by BHEL’s manufacturing units at Haridwar, Trichy, Bengaluru and Bhopal while the execution on site will be undertaken by the company’s Power Sector – Western Region, Nagpur.

Orderbook as on FY22 was at around Rs 1 lakh crore which is 4.3 times trailing twelve month sales of the company, ICICI Securities pointed out.

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The Central Electricity Authority (CEA) has recently (in the Draft National Electricity Plan) announced coal-based capacity addition of 43 GW over the coming decade, 25 GW of which is under construction and balance is to be awarded soon. Additionally, the industrial segment business is likely to accelerate on the back of an improved outlook, the domestic brokerage firm added.

BHEL is India’s largest engineering and manufacturing enterprise in the energy and infrastructure sector. It is a leading power equipment manufacturer globally and has major offerings for industry and infrastructure sectors, including transportation, defence and aerospace, renewables, transmission, industrial products, energy storage solutions and new business areas like electric vehicles (EVs).

In the past three months, the stock has risen 24 percent.