BEML shares: Brokerages split after muted Q2; here's what PL, Elara Capital say
According to PL, BEML's Q2 FY26 revenue declined 2.4 per cent year-on-year (YoY) to Rs 840 crore, with EBITDA margin steady at 8.7 per cent. The brokerage attributed the weak performance to a slower execution pace and supply chain challenges.
- Nov 7, 2025,
- Updated Nov 7, 2025 12:35 PM IST
BEML Ltd reported a subdued performance for the July–September quarter (Q2 FY26), prompting mixed reactions from brokerages. While Prabhudas Lilladher (PL) maintained a 'Hold' rating, citing execution delays and near-term constraints, Elara Capital reiterated its 'Buy' stance, highlighting the company's strong order pipeline and margin resilience.
According to PL, BEML's Q2 FY26 revenue declined 2.4 per cent year-on-year (YoY) to Rs 840 crore, with EBITDA margin steady at 8.7 per cent. The brokerage attributed the weak performance to a slower execution pace and supply chain challenges.
It revised its FY27/FY28 earnings estimates downward by 7.6 per cent and 4.7 per cent, respectively. Despite these headwinds, PL noted that the company maintained a robust order book of Rs 16,340 crore, supported by sustained demand across mining, railways and defence segments.
Order inflows stood at Rs 2,700 crore during the quarter, led by a Rs 1,890 crore order from the Integral Coach Factory under railways and around Rs 600 crore in defence orders for heavy mobility vehicles.
PL expects export contribution to rise to about 4 per cent in FY26 from 1 per cent in FY25, with a higher defence mix aiding gradual margin recovery. However, it flagged a sharp deterioration in cash flow, with cash from operations at (-)Rs 240 crore in H1 FY26 compared with (+)Rs 180 crore in FY25.
The brokerage rolled forward valuations to September 2027 and retained its 'Hold' rating with a revised target price of Rs 1,982 (from Rs 2,071 earlier).
Elara Capital also pointed to the 2 per cent YoY revenue decline, attributing it to delayed execution in the rail and metro segment. Nonetheless, it highlighted BEML's steady EBITDA of Rs 73.2 crore and margin of 8.7 per cent, better than its estimate of 8.1 per cent.
The management guided for 15–20 per cent revenue growth in FY26, a 150 basis points (bps) margin improvement and a potential doubling of the order book during the fiscal year.
Factoring in the strong order visibility and expected ramp-up in the second half, Elara raised its target price to Rs 2,780 from Rs 2,610, valuing the stock at 37x September FY27 earnings and maintaining a 'Buy' rating.
BEML Ltd reported a subdued performance for the July–September quarter (Q2 FY26), prompting mixed reactions from brokerages. While Prabhudas Lilladher (PL) maintained a 'Hold' rating, citing execution delays and near-term constraints, Elara Capital reiterated its 'Buy' stance, highlighting the company's strong order pipeline and margin resilience.
According to PL, BEML's Q2 FY26 revenue declined 2.4 per cent year-on-year (YoY) to Rs 840 crore, with EBITDA margin steady at 8.7 per cent. The brokerage attributed the weak performance to a slower execution pace and supply chain challenges.
It revised its FY27/FY28 earnings estimates downward by 7.6 per cent and 4.7 per cent, respectively. Despite these headwinds, PL noted that the company maintained a robust order book of Rs 16,340 crore, supported by sustained demand across mining, railways and defence segments.
Order inflows stood at Rs 2,700 crore during the quarter, led by a Rs 1,890 crore order from the Integral Coach Factory under railways and around Rs 600 crore in defence orders for heavy mobility vehicles.
PL expects export contribution to rise to about 4 per cent in FY26 from 1 per cent in FY25, with a higher defence mix aiding gradual margin recovery. However, it flagged a sharp deterioration in cash flow, with cash from operations at (-)Rs 240 crore in H1 FY26 compared with (+)Rs 180 crore in FY25.
The brokerage rolled forward valuations to September 2027 and retained its 'Hold' rating with a revised target price of Rs 1,982 (from Rs 2,071 earlier).
Elara Capital also pointed to the 2 per cent YoY revenue decline, attributing it to delayed execution in the rail and metro segment. Nonetheless, it highlighted BEML's steady EBITDA of Rs 73.2 crore and margin of 8.7 per cent, better than its estimate of 8.1 per cent.
The management guided for 15–20 per cent revenue growth in FY26, a 150 basis points (bps) margin improvement and a potential doubling of the order book during the fiscal year.
Factoring in the strong order visibility and expected ramp-up in the second half, Elara raised its target price to Rs 2,780 from Rs 2,610, valuing the stock at 37x September FY27 earnings and maintaining a 'Buy' rating.