BHEL

Strikes Gold: ₹6,500 Cr Adani Power Deal Propels Order Book Past ₹2 Lakh Cr”

Bharat Heavy Electricals Ltd. (BHEL) on June 27 received a Letter of Award (LoA) from Adani Power for supplying and commissioning six thermal‐power units, each with 800 MW capacity. The contract—valued at about ₹6,500 crore (ex-GST)—covers steam-turbine generators, auxiliaries and supervision of erection & commissioning. 1. Boost to Order Book • With this award, BHEL’s total order backlog crosses the ₹2 lakh crore mark. As of March 31, 2025, its order book stood at ₹1.959 lakh crore, 75 percent of which is in the power segment. The company had secured record inflows of ₹92,534 crore in FY 2024-25, driven largely by power‐sector orders. 2. Strategic Significance • Adani Power is now BHEL’s top private‐sector customer, with 20 boilers and turbines ordered to date. This deal underscores BHEL’s turnaround from order drought to leadership in thermal‐power equipment, leveraging its in-house manufacturing and ancillary network across Tiruchi, Pudukottai and elsewhere. 3. Financial & Stock Implications • BHEL’s FY 2024-25 revenue rose by 19 percent YoY to ₹27,350 crore. Its stock, though down ~11 percent over the past year, is up 13 percent YTD and has delivered multibagger returns—213 percent over two years, 475 percent over three and 616 percent over five. • Technically, the scrip trades above its 5- to 200-day SMAs, with a 14-day RSI at 63.4. Valuation metrics: P/E of 179.6 and P/B of 3.742. 4. What Investors Should Watch • Execution Risk: Timely delivery & commissioning will be key to revenue recognition. • GST Impact: Final billing at ex-GST contract value may affect cash flows. • Capex Cycle: Continued order wins from NTPC, NLC & state utilities could sustain BHEL’s momentum