Despite BHEL shares at all-time high, why analyst sees up to 65% fall
Shares of BHEL have been on a roll lately as the state-run capital goods major has surged as much as 67 per cent in the last one month, but analysts see up to 65 per cent crash.
- May 8, 2026,
- Updated May 8, 2026 12:59 PM IST
BHEL shares target price: Shares of Bharat Heavy Electricals Ltd (BHEL) have been on a roll lately as the state-run capital goods major has surged as much as 67 per cent in the last one month, hitting its new all time highs, post its quarterly earnings, robust order book and strong demand for the products. However, select brokerage firms see up to 65 per cent fall in the stock.
BHEL shares
Shares of BHEL rose to Rs 408.90 on Friday, hitting its all time-high, commanding a market capitalization close to Rs 1.45 lakh crore. The stock has surged 67 per cent in month from Rs 245.20 in the first week of April, while it has nearly doubled investors wealth from its 52-week low at Rs 205.20 in little more than 8 months.
BHEL shares are 40 per cent in 2026 so far, while the stock is up 50 per cent in the six months. The stock has delivered a solid 600 per cent return in the last five years, while the stock has zoomed more than 1,750 per cent in from its Covid-19 lows.
BHEL Q4 results
Bharat Heavy Electricals (BHEL) reported a 156 per cent YoY rally in the net profit at Rs 1,296.1 crore, while surged 37.2 per cent YoY to Rs 12,310.1 crore for the March 2026 quarter. Ebitda surged 111 per cent YoY to Rs 1,753.4 crore, with its margins increased 500 basis points to Rs 14.2 per cent for the quarter.
BHEL's growth during the quarter was driven by strong execution in its power segment which led to the sharp improvements in margins as well. Beside this The multibagger PSU player announced a final dividend of Rs 1.4 per share for its shareholders, highest amount in nearly 10 years.
BHEL target prices
BHEL reported a strong uptick in execution in 4QFY26, as recent project wins contribution scales up to substitute for legacy projects. This is potentially reflecting an improvement in gross margin and cash flows at a faster pace than envisaged, said Kotak Institutional Equities.
"A large part of the margin expansion beyond gross margin appears to be driven by provision write-backs and unrealized forex gains. We revise our fair value to Rs 140 (Rs 120 earlier), at broadly unchanged assumptions for thermal power ordering, near-term uptick in margins and build-up of opportunity in coal gasification," it added. Its price target suggests 65 per cent fall in BHEL stock.
BHEL delivered a strong Q4FY26 performance driven by robust execution of its order backlog, while margin expanded supported by lower other expenses. BHEL has successfully commissioned 8.9GW of power capacity in FY26 reinforcing its positioning in the thermal space. Recent easing in localisation norms for HVDC is expected to support execution of key HVDC projects, said PL Capital.
"With a robust order book of Rs 2.4 lakh crore, BHEL offers strong multi-year revenue visibility; however, sustained execution momentum and provision numbers remain a key monitorable. The stock is currently trading at P/E of 40.4 times/27 times on FY27E/FY28E. We roll forward to March 2028E and downgrade the stock to ‘reduce’ given the recent rally in stock, target price of Rs 321," it added.
The order inflow momentum is expected to sustain as the CEA has outlined a thermal capacity addition target of 97 GW by FY35, with incremental demand from replacement of 37 GW of ageing thermal plants that will cross 35 years of life by FY32, ICICIDirect. "We expect strong order inflow of Rs 1,23,000 crore over FY27-28E."
Good accretion of orders and strong ordering pipeline will keep order inflows strong coupled with strong pick in execution from FY27E onwards. This will also help margins and return ratios to improve meaningfully over the next 2-3 years, it added. ICICIDirect has a 'buy' with fair value of Rs 460.
BHEL shares target price: Shares of Bharat Heavy Electricals Ltd (BHEL) have been on a roll lately as the state-run capital goods major has surged as much as 67 per cent in the last one month, hitting its new all time highs, post its quarterly earnings, robust order book and strong demand for the products. However, select brokerage firms see up to 65 per cent fall in the stock.
BHEL shares
Shares of BHEL rose to Rs 408.90 on Friday, hitting its all time-high, commanding a market capitalization close to Rs 1.45 lakh crore. The stock has surged 67 per cent in month from Rs 245.20 in the first week of April, while it has nearly doubled investors wealth from its 52-week low at Rs 205.20 in little more than 8 months.
BHEL shares are 40 per cent in 2026 so far, while the stock is up 50 per cent in the six months. The stock has delivered a solid 600 per cent return in the last five years, while the stock has zoomed more than 1,750 per cent in from its Covid-19 lows.
BHEL Q4 results
Bharat Heavy Electricals (BHEL) reported a 156 per cent YoY rally in the net profit at Rs 1,296.1 crore, while surged 37.2 per cent YoY to Rs 12,310.1 crore for the March 2026 quarter. Ebitda surged 111 per cent YoY to Rs 1,753.4 crore, with its margins increased 500 basis points to Rs 14.2 per cent for the quarter.
BHEL's growth during the quarter was driven by strong execution in its power segment which led to the sharp improvements in margins as well. Beside this The multibagger PSU player announced a final dividend of Rs 1.4 per share for its shareholders, highest amount in nearly 10 years.
BHEL target prices
BHEL reported a strong uptick in execution in 4QFY26, as recent project wins contribution scales up to substitute for legacy projects. This is potentially reflecting an improvement in gross margin and cash flows at a faster pace than envisaged, said Kotak Institutional Equities.
"A large part of the margin expansion beyond gross margin appears to be driven by provision write-backs and unrealized forex gains. We revise our fair value to Rs 140 (Rs 120 earlier), at broadly unchanged assumptions for thermal power ordering, near-term uptick in margins and build-up of opportunity in coal gasification," it added. Its price target suggests 65 per cent fall in BHEL stock.
BHEL delivered a strong Q4FY26 performance driven by robust execution of its order backlog, while margin expanded supported by lower other expenses. BHEL has successfully commissioned 8.9GW of power capacity in FY26 reinforcing its positioning in the thermal space. Recent easing in localisation norms for HVDC is expected to support execution of key HVDC projects, said PL Capital.
"With a robust order book of Rs 2.4 lakh crore, BHEL offers strong multi-year revenue visibility; however, sustained execution momentum and provision numbers remain a key monitorable. The stock is currently trading at P/E of 40.4 times/27 times on FY27E/FY28E. We roll forward to March 2028E and downgrade the stock to ‘reduce’ given the recent rally in stock, target price of Rs 321," it added.
The order inflow momentum is expected to sustain as the CEA has outlined a thermal capacity addition target of 97 GW by FY35, with incremental demand from replacement of 37 GW of ageing thermal plants that will cross 35 years of life by FY32, ICICIDirect. "We expect strong order inflow of Rs 1,23,000 crore over FY27-28E."
Good accretion of orders and strong ordering pipeline will keep order inflows strong coupled with strong pick in execution from FY27E onwards. This will also help margins and return ratios to improve meaningfully over the next 2-3 years, it added. ICICIDirect has a 'buy' with fair value of Rs 460.