Shares of state-run capital goods major Bharat Heavy Electricals Ltd (BHEL) have experienced a significant rally, climbing approximately 60% over the past month. The surge propelled the stock to new record highs on Monday, May 4, 2026, following the announcement of its strong fourth-quarter earnings.
Impressive Q4 Performance Drives Momentum
BHEL reported a robust financial performance for the March 2026 quarter, significantly exceeding expectations. The company's net profit soared by 156% year-over-year to Rs 1,296.1 crore. Revenue also saw a substantial increase of 37.2% year-over-year, reaching Rs 12,310.1 crore. This growth was primarily fueled by strong execution within its power segment.
EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) zoomed 111% year-over-year to Rs 1,753.4 crore, with margins expanding by 500 basis points to 14.2% for the quarter. Additionally, BHEL announced a final dividend of Rs 1.4 per share, marking its highest payout in nearly a decade.
Brokerages Remain Optimistic, Set Higher Targets
Following the stellar results and sustained stock performance, several brokerage firms have reiterated their positive outlook on BHEL, raising their target prices.
- ICICI Securities maintained a 'buy' rating, revising its target price to Rs 450 from Rs 370. The firm anticipates execution growth at a 13% CAGR over FY26-28 and expects further profitability improvements driven by strong order inflows.
- Antique Stock Broking also retained its 'buy' recommendation with a target price of Rs 430. They foresee improved operating performance in FY27 as recently secured higher-margin orders move into the execution phase, alongside forecasted healthy order inflows of approximately 10+ GW over FY27-28.
- JM Financial issued a 'buy' rating, increasing its target price to Rs 435 from Rs 393. The firm highlighted BHEL's substantial order book, which stands at Rs 2,40,000 crore after booking Rs 75,900 crore in FY26. They project BHEL to maintain order inflows of Rs 60,000–70,000 crore annually in FY27 and FY28.
- BP Wealth assigned a 'buy' rating with a target price of Rs 410. They emphasized the strong demand from India’s power sector providing significant revenue visibility. Furthermore, BHEL's strategic entry into Oil & Gas EPC, partnerships with ISRO in the growing space sector, and defense export opportunities are expected to widen its total addressable market.
Future Outlook: Diversification and Sectoral Growth
Analysts point to India's continued focus on thermal power capacity additions, modernization of state power utilities, expansion of the railway network, and rising indigenization in defense procurement as creating a structurally favorable demand environment for BHEL. The company's robust order book, coupled with its diversification efforts, positions it for sustained growth in the coming years.