NSE Symbol: BHEL | BSE Code: 500103
In January 2018, the BHEL Share price opened at Rs.92.90 on the BSE while it was at Rs.92.65 on the NSE.
The share prices steadily rose till mid-January of 2018 and then dropped a little right after. It was a temporary situation which lasted only for a few days.
The share prices again increased and steadily hovered around Rs.100 for a few days. At the beginning of February, it dropped again by around Rs.6; it increased again over the next few days.
This rise lasted till mid-February and the share prices rose to Rs.97 when an interim 40% dividend was announced.
This news about the dividend resulted in a drop in the share prices of BHEL, which now hovered around Rs.90 for the rest of the month. It eventually went below Rs.90 after the first week of March.
In the rest of March, the shares of BHEL were traded at various levels ranging from Rs.81 to Rs.90. The closing price of the shares, on March 28, 2018, was Rs.81.35 on the NSE. The shares gained a little over 8% in the first week of April and went above Rs.88.
Things didn’t change much for the remaining days in the month; the BHEL shares went steady at above Rs.88 but fell to Rs.87.80 on April 30, 2018.
In May, the share price dropped by around 5% and went below the Rs.80 threshold. The shares were seen floating and switching hands at levels above Rs.75 for the most of the month. A similar trend followed over the next two months. Thus, BHEL share price was in a state of steady decline till it hit its 52-week low at Rs.64.45 in mid-July.
However, the shares displayed a gradual recovery in August when it gained a little more than 25% and reached their previous levels at above Rs.80. The BHEL closing share price on August 31, 2018, was Rs.80.60.
BHEL is an enterprise owned by the Government of India. It is focused on sectors such as power plant, engineering, railways, renewable energy, etc., and also takes up Defence contracts. BHEL aims to ensure that the country becomes self-sufficient in indigenous manufacturing for power plants. It has an outstanding track record in the realm of power generation as well as in the installations of electrical equipment. As a result, the Government of India awarded the status of 'Maharatna' on this company, which is an exclusive award and has been given to only nine companies so far for their outstanding performance and also for their contribution to the growth and development of the country. The sale of equipment like turbines and boilers that are used in generating power is the main source of revenue generated by BHEL. Moreover, it supplies electric locomotives to the Indian railways. BHEL also invests a significant amount in research and development. Its major manufacturing plants are located in various cities throughout the country.
BHEL is a PSU (public sector undertaking) of the Government of India. Heavy Electricals (India) Limited merged with BHEL in the year 1964. At present, BHEL is the largest company in India which is dealing in power generation and heavy electrical equipment manufacturing. It was converted into a public company in 1991. BHEL has proceeded to supply equipment in 2017, which generated 55% of the country's total installed power generation capacity. Besides power generation, BHEL has also branched out into areas like water treatment. Mr. Atul Sobti, the Chairman & Managing Director of the company, heads BHEL whereas, Mr. Subrata Biswas and Mr. Amitabh Mathur are the Executive Directors. The company is listed on the BSE as 500103 and on the NSE as BHELEQ. Investors can buy and sell the shares of BHEL on both of these exchanges. Moreover, it is also listed in other stock exchanges like Bangalore Stock Exchange, Calcutta Stock Exchange Association, MCX Stock Exchange, etc. and in several indices as well like NIFTY100, Sensex Next 50, etc. As of March 6, 2018, BHEL’s market capitalization stands at over Rs.33,000 crore. BHEL share price fluctuates at every moment and thus it is very important for all potential investors to keenly study the performance of the company’s shares before investing in it.
Quarter 1 of FY 2018-19
In the June quarter of FY 2018-19, BHEL has reported its income to be Rs.5790.08 crores. If compared to the same quarter in the previous year, the company's income has improved by approximately Rs.400 crore. However, if we consider q-o-q, we can notice a drop of over Rs.4000 crore. The BHEL share price was around Rs.71 during the close of this quarter.
The expenses for the period were more or less alike, in comparison to the first quarter of FY 2017-18.
If we consider the profitability of the company for the given period, the reports place it at Rs.155.58 crore, as against the profit of Rs.80.02 that was stated for the corresponding quarter of the previous year.
BHEL’s basic earnings per share or EPS increased from Rs.0.22 to Rs.0.42, y-o-y.
In the final quarter of FY, which ended in March 2018, BHEL’s standalone income from operations was declared to be Rs.27,850.44 crore. In comparison to the figure stated in the previous fiscal year, the revenues seem to have improved by around Rs.100 crore. BHEL share price hovered around Rs.81 during this time.
However, after considering the total expenses incurred over the year, the figure shot up to Rs.28,169 crore. Compared to the previous fiscal year, the expenditure for this period dropped by approximately Rs.1,600 crore.
As a consequence, the company’s profitability for the year increased dramatically over as compared to the previous fiscal year. During FY 2017-18, the company reported a standalone profit (before tax) of Rs.1,585 crore, recording an improvement of over 150% y-o-y. Taking into account the net profit after tax, it improved by 63% y-o-y to reach Rs.807 crore.
BHEL’s order book was worth Rs.40,932 crore in FY 2017-18, which was a 74% leap over the previous fiscal year. The Board of Directors of BHEL also recommended a final dividend of 51%. Moreover, the basic EPS (earnings per share) for the year was Rs.2.20 as compared to an EPS of Rs.1.35 in the previous financial year
The total non-current liabilities of BHEL were stated to be worth Rs.8,937.8 crore in March 2018, which was a slight increase of around Rs.100 crore y-o-y.
As per the quarterly financial reports that BHEL released, its total income was reported to be Rs.6,763.84 crore in the quarter ending in December 2017.
This was a fall from the total income reported in the previous quarter that ended in September 2017 at Rs.6782.08 crore. However, it recorded a rise from the corresponding quarter in 2016, when the total income was Rs.6,738.60 crore.
Therefore, the total income for the December quarter in 2017 clearly ended with a decrease when compared to the previous quarter. However, it was still higher than the income in the corresponding period in 2016.
The profit before tax, in the quarter ending December 2017, was Rs.189.84 crore, whereas it was Rs.147.25 crore in the previous quarter and Rs.124.55 crore in the quarter ending December 2016. BHEL stock price was around Rs.80 during the close of this quarter.
Therefore, it is clear that the company has shown a steady rise in profit before tax for a year.
The quarter ending in December 2017 reported a net profit of Rs.153.19 crore, whereas the net profit in the same period during the previous year was Rs.93.54 crore. The net profit for the second quarter, ending in September 2017, was Rs.115.42 crore.
Thus, it can be observed that BHEL has increased its net profit gradually over the course of the FY 2016–2017.
The share market is considered to be a risky affair. There is no correct answer to this question. An investor must study the BHEL share price fluctuations, the market performance and trend of the company in order to decide if it would be a worthy investment. Observing the current trends, there has been a significant volatility of BHEL stock price in recent months. If someone invests in dividend stocks of BHEL for 5 years, it is suggested that the investor keeps checking for the fluctuation. BHEL is a cyclical share and one might profit from short-term investments, made in close monitoring.