BHEL shares rally cools and UBS downgrades PSU major, here's why
According to UBS, BHEL should continue to benefit from steady order inflows from thermal power and industrial projects.
- Jun 5, 2026,
- Updated Jun 5, 2026 11:56 AM IST
BHEL share price: Shares of Bharat Heavy Electricals Ltd (BHEL) have fallen nearly 10% from their record high. The PSU stock has been in profit-booking mode since a week. Amid the ongoing correction in the multibagger stock, global brokerage UBS has downgraded the stock to Neutral from Buy. The brokerage cited 60% outperformance against the Nifty index over past 12 months behind the downgrade. UBS also said the risk-reward has become more balanced.
On the brighter side, UBS raised BHEL's price target to Rs 460 from Rs 375.
The brokerage continues to expect steady order prospects for thermal & industrial segments – with new orders of Rs 1.36 lakh crore across FY27-28E supporting steady order book growth.
The brokerage believes that risk-reward has now become more balanced with bulk of order book expansion behind it. The consensus underappreciates BHEL’s earnings growth potential, according to UBS which raised target multiples from 25x to 28x & lifted FY27/28E earnings estimates by 1–3% to reflect higher earnings visibility and sustained ordering.
According to UBS, BHEL should continue to benefit from steady order inflows from thermal power and industrial projects. The company is expected to win orders worth around Rs 1.36 lakh crore over FY27 and FY28.
Meanwhile, global brokerage Morgan Stanley has an overweight stance on the BHEL stock.
It has a price target of Rs 444 against the earlier Rs 304. The target price was revised higher after rolling valuation forward and lifting target multiples for the PSU major.
Morgan Stanley said Q4 execution, margins and operating cash flow surprised positively and the brokerage sees improving macro backdrop benefiting thermal power and electrification themes.
The brokerage highlighted a strong 2.4 lakh crore order book providing seven-year revenue visibility for the PSU. It expects margins to rise further as execution accelerates in FY27-28
The brokerage raised FY27/FY28 EPS estimates by 10%/9%.
The rally in the PSU stock has cooled with the stock trading below its 5 day, 10 day and 20 day simple moving averages.
Despite profit-booking, BHEL stock is one of the major gainer in the PSU segment, zooming 55.39% in three months. The stock hit its record high of Rs 424.85 on May 29, 2026.
The stock has a beta of 1.3, indicating high volatility in a year. The stock has risen 37% this year and gained 44% in six months. It has risen 440% in five years and 367% in three years.
In the current session, BHEL shares were trading 1.35% higher at Rs 395.20. Market cap of the firm stood at Rs 1.36 lakh crore. Total 9.81 lakh shares of the firm changed hands amounting to a turnover of Rs 38.37 crore.
BHEL share price: Shares of Bharat Heavy Electricals Ltd (BHEL) have fallen nearly 10% from their record high. The PSU stock has been in profit-booking mode since a week. Amid the ongoing correction in the multibagger stock, global brokerage UBS has downgraded the stock to Neutral from Buy. The brokerage cited 60% outperformance against the Nifty index over past 12 months behind the downgrade. UBS also said the risk-reward has become more balanced.
On the brighter side, UBS raised BHEL's price target to Rs 460 from Rs 375.
The brokerage continues to expect steady order prospects for thermal & industrial segments – with new orders of Rs 1.36 lakh crore across FY27-28E supporting steady order book growth.
The brokerage believes that risk-reward has now become more balanced with bulk of order book expansion behind it. The consensus underappreciates BHEL’s earnings growth potential, according to UBS which raised target multiples from 25x to 28x & lifted FY27/28E earnings estimates by 1–3% to reflect higher earnings visibility and sustained ordering.
According to UBS, BHEL should continue to benefit from steady order inflows from thermal power and industrial projects. The company is expected to win orders worth around Rs 1.36 lakh crore over FY27 and FY28.
Meanwhile, global brokerage Morgan Stanley has an overweight stance on the BHEL stock.
It has a price target of Rs 444 against the earlier Rs 304. The target price was revised higher after rolling valuation forward and lifting target multiples for the PSU major.
Morgan Stanley said Q4 execution, margins and operating cash flow surprised positively and the brokerage sees improving macro backdrop benefiting thermal power and electrification themes.
The brokerage highlighted a strong 2.4 lakh crore order book providing seven-year revenue visibility for the PSU. It expects margins to rise further as execution accelerates in FY27-28
The brokerage raised FY27/FY28 EPS estimates by 10%/9%.
The rally in the PSU stock has cooled with the stock trading below its 5 day, 10 day and 20 day simple moving averages.
Despite profit-booking, BHEL stock is one of the major gainer in the PSU segment, zooming 55.39% in three months. The stock hit its record high of Rs 424.85 on May 29, 2026.
The stock has a beta of 1.3, indicating high volatility in a year. The stock has risen 37% this year and gained 44% in six months. It has risen 440% in five years and 367% in three years.
In the current session, BHEL shares were trading 1.35% higher at Rs 395.20. Market cap of the firm stood at Rs 1.36 lakh crore. Total 9.81 lakh shares of the firm changed hands amounting to a turnover of Rs 38.37 crore.