Bharat Heavy Electricals Ltd. share price target

We believe the ordering activity to pick up and inflows are estimated to reach 7.9Gw/8.7Gw for FY16E/FY17E, which is just half of the peak ordering activity of 19.3Gw seen during FY09. Nevertheless, we expect commissioning to remain flat at 12Gw during FY15-17E and order backlog to reach 29.6Gw/26.4Gw by FY16E/ FY17E. We have taken into account of recent orders from Government sector with a moderate to negative bias as these are contingent to host of factors like: 1) Legacy issues - Land, environment and legal; 2) Indian Government's (GoI) emphasis on efficiency; 3) GoI's focus on renewable energy mission 2022 and commitment to cut carbon emission by 2030; 4) Perusal of R-APDRP; 5) Retrofit opportunity.

Bharat Heavy Electricals Ltd. (BHEL) is the largest engineering and manufacturing enterprise in India in the energyrelated/infrastructure sector. The Company is engaged in the design, engineering, manufacture, construction, testing, commissioning and servicing of a wide range of products and services for the core sectors of the economy, viz. Power, Transmission, Industry, Transportation, Renewable Energy, Oil & Gas and Defence. BHEL has an overall share of 59% in India's total installed...

BHEL's Q1FY16 earnings were lower than our estimate due to lower gross margin and weaker execution translating to negative operating leverage. Management expects order flowtoremainrobustdrivenbystateutilitiesandexpectspickupinexecutionfromQ3FY16....

Buy on dips to Rs 194 - Rs 208 for Target of Rs 235 in 1 quarter

income. Management expects order flow to remain robust driven by central and state utilities; however, it expects execution to remain weak till the time there is a pickup in strandedprojects.WereduceourFY16/17earningsestimateby8%/2%toincorporateweak...

BHEL reported yet another poor quarter with revenue falling 16% YoY and OPM of 13.3% (down 500bps YoY). APAT at Rs 8.9bn fell 52% YoY. However, PAT was higher by Rs 1bn than reported PAT in the flash results due to lower audited raw material costs.

Rs 19bn (62% YoY, PC estimate Rs 32bn) and PAT at Rs 13bn (62% YoY) lower than estimateofRs22bn.WeestimateEBITAmarginsstoodat4.5%forFY15.Weshallrevisit ourestimatespostdetailedresultsareannouncedinMay,2015....

Buy on dips to Rs 242 - Rs 254 for Target of Rs 273 in 1 quarter

BHEL reported yet another poor quarter with revenue falling 28% YoY (est. 9% decline) and OPM of 4.7%. PAT at Rs 2.1bn was way lower than our estimate of Rs 4.7bn. Order inflow of Rs 66bn was in line with our estimates.