Bharat Heavy Electricals Ltd (BHEL) has already secured 3GW of thermal orders in H1FY24, according to a recent report from domestic brokerage Nuvama Institutional Equities. An additional 7.4GW of thermal orders are presently being tendered for (awards by Q4FY24/Q1FY25). So, the brokerage projects that BHEL will have 6-7GW of thermal OI and a 50% market share by the end of FY24.
The power ministry of India raised its thermal capital expenditure target to 50–55 GW (from 30 GW), according to the brokerage, due to increased power demand and the inadequacy of renewable energy sources to meet the country's continuous supply needs.
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The brokerage increased the target price by 50%, from ₹150 to ₹225. The stock might witness an upside by more than 30% from its current levels, according to brokerage.
“Given macro tailwinds, we factor in BHEL’s OI at about 4.5GW/year (~3GW earlier), leading to higher revenues and operating leverage-led EBITDA margin expansion to 6.5%/10% in FY25/26E (from 4.8%/8.4%). We are lifting FY25/26E EPS by 56%/32%," the brokerage said.
With the power balance having already moved towards a deficit scenario from May 23 to September 23, when the stock price was ₹94, the brokerage upgraded BHEL to Braveheart 'BUY' in July 2023.
Also Read: Stellar rally! Nifty 50 jumps 1,159 points in just 13 sessions
As a result of the Ministry of Power's (MoP) two increases in thermal capital expenditure targets in the last three months, the brokerage projects 8–12 GW of annual thermal ordering over FY24–30E. For BHEL, it accounts for a 50% market share and approximately 4.5 GW of annual thermal output in a duopolistic market (where L&T's sole rival is). This goes above and beyond its usual OI of ₹140–180 billion, which was oBSErved even during the previous four–five years' downturn.
"We value BHEL at 22x Mar-26E EPS, implying upside potential of 30%-plus at a revised target price of ₹225 (earlier ₹150). Our bull case with a 70% market share and 12% margins implies a bull case target price of ₹272," the brokerage said.
Also Read: Sensex, Nifty hit record highs: What should be your investment strategy now?
On Monday's overall positive market, BHEL share price touched 52-week high and rose 3.6%. BHEL share price opened at ₹175, and touched intraday high of ₹176.50, and low of ₹170.85 on BSE.
The Nifty 50 hit a new record high of 20,602.50 and the Sensex hit a record high of 68587.82 on Monday. Similarly, the BSE Midcap and Smallcap indices reached record highs at 35,124.23 and 41,221.91, respectively.
Following the state election results, there were significant gains in the domestic market, which boosted trust in the political stability of the country.
Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.
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Updated: 04 Dec 2023, 12:25 PM IST
ENGLAND TOUR OF WEST INDIES, 2023
England have made a few changes to their ODI squad. © AFP
Jos Buttler has already called this series "a bit of a new beginning". He arrives on the Caribbean shores still intact as the ODI captain, and accompanying him are only five other members from England's underwhelming campaign at the World Cup in India last month. But there's another trophy to be won in a few months time, albeit in the T20 format, which means England don't have the time to start from scratch.
And so England have retained faith in Buttler at the top, a World Cup-winning captain nonetheless as they aim for a soft reset in white-ball cricket. If why they are doing so with an ODI series while preparing for a T20 World Cup is what's bothering you, then welcome to cricket in 2023.
The ODI format is something that the West Indies wouldn't mind engaging with. Having failed to qualify for the World Cup, they just spent the last couple of months watching teams fight for the trophy they helped establish the legacy of once upon a time. Thankfully, there's all of four years to build towards winning an ICC ODI trophy, for they will again not be participating in the Champions Trophy next year.
Under Shai Hope as captain and Alzarri Joseph as the new vice captain, West Indies start a new cycle by taking on England, a team they love to beat and a team which tends to bring the best out of them. There will be no Nicholas Pooran, Jason Holder and Darren Bravo turning up for them this time, so it will be up to the fresh faces in the camp to step up and make a mark.
All in all, the series might seem like low-stakes on first glance but there's plenty of opportunities for both teams to suss out new players on the circuit. What does Alick Athanaze have up his sleeve? How exciting will Will Jacks be at the top of the order? Can Rehan Ahmed stand up to the standards set by Adil Rashid? How will Alzarri perform with the vice-captaincy tag? There's plenty to look forward to as both teams not only build up to the next ODI World Cup but also slowly get into rhythm for the upcoming T20 World Cup, which will be played in the same conditions.
When: 1st ODI, December 3, 2023, 09:30 AM LOCAL
Where: Sir Vivian Richards Stadium, North Sound, Antigua
**What to expect:**The ground last hosted ODIs in 2021, all three of which were won by the hosts. The pitches here are usually slow, which means middling scores. The 300-mark has been breached only three times in 20 ODIs here but England's all-out approach, if still around, could mean that West Indies could be forced to go hard at the top too.
Team News
West Indies:
Batting allrounder Sherfane Rutherford and bowling allrounder Matthew Forde are the two uncapped players in the squad and in line to make their debuts. Shane Dowrich, who was named in the squad after a gap of three years, has since retired much to the surprise of everyone and hence won't be available.
Probable XI: Brandon King, Kjorn Ottley, Alick Athanaze, Shai Hope (c/w), Keacy Carty, Shimron Hetmyer, Sherfane Rutherford, Matthew Forde/Romario Shepherd, Alzarri Joseph, Oshane Thomas, Gudakesh Motie
England:
Buttler has confirmed that he won't move to the top of the order, which would mean that Will Jacks, Phil Salt and Zak Crawley are likely to take the top three spots.
Probable XI: Phil Salt, Will Jacks, Zak Crawley, Harry Brook, Jos Buttler (c/w), Ben Duckett, Liam Livingstone/Tom Hartley, Sam Curran, Brydon Carse, Rehan Ahmed, Gus Atkinson
Did you know?
West Indies and England last played each other in an ODI at the 2019 World Cup
Buttler is 39 runs away from 5000 ODI runs but comes into this game with only 51 runs in his last five ODIs
In 2023, Hope has averaged nearly 80 in the middle overs (11-40) at a strike-rate of 91
What they said:
"We have had one bad tournament. It [England cricket] has been in a great place for a long time and you see the depth of talent of guys coming through and you want to help shape that period of white ball cricket. That's something I feel responsibility and motivation for and individually I am always incredibly motivated to perform the best I can and reach my potential. Any time that you get challenged and get pushed back and people challenge that sort of thing, it certainly lights a few fires and motivates you" - Jos Buttler, England captain
© Cricbuzz
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