BHEL - B H E L

📊 NSE: BHEL 🏢 Electric Equipment 📅 Last Updated: 12/13/2025 18:49

💰 Financial Performance

Revenue Growth by Segment

Total revenue grew 19% YoY to INR 28,339 Cr in FY25. The Power segment contributed 74% of total revenue (approx. INR 20,970 Cr), while the Industry segment, including exports, contributed the remaining 26% (approx. INR 7,369 Cr).

Geographic Revenue Split

While specific regional percentages are not detailed, the company has a widespread overseas footprint with references in 91 countries and operates over 150 project sites across India.

Profitability Margins

Profit After Tax (PAT) margin improved from 1.18% in FY24 to 1.9% in FY25. Operating margins improved to 4.4% in FY25 from 3.2% in FY24, with a medium-term target of 7-8% as legacy projects are completed.

EBITDA Margin

PBILDT margin increased to 4.38% in FY25 from 2.53% in FY24, representing a YoY improvement of 185 basis points driven by better absorption of overheads in the industry segment.

Capital Expenditure

BHEL plans an annual capital expenditure of approximately INR 500 Cr over the medium term, to be funded entirely through internal cash accruals. Additionally, INR 1,700 Cr is committed to a coal gasification JV with Coal India Limited over the next 3-4 years.

Credit Rating & Borrowing

Maintains a 'CRISIL A1+' rating for short-term facilities. Interest coverage ratio improved significantly from 0.73x in FY24 to 1.66x in FY25 (reported as 2.36x in some indicators) due to improved profitability.

⚙️ Operational Drivers

Raw Materials

Steel, copper, and other volatile commodities are primary inputs; however, specific percentage breakdowns per material are not disclosed in the documents.

Import Sources

Not specifically disclosed in available documents, though the company emphasizes 'Atmanirbhar Bharat' and indigenous technology thrust.

Key Suppliers

Not specifically named, but the company has signed an Integrity Pact with Transparency International India for procurement transparency.

Capacity Expansion

Current manufacturing capacity allows for the delivery of up to 20 GW of power equipment per year across 16 manufacturing units.

Raw Material Costs

Profitability remains sensitive to volatile commodity prices due to only partial pass-through mechanisms in contracts; cost overruns in the power segment moderated FY25 margins.

Manufacturing Efficiency

Efficiency is driven by a large R&D spend of INR 662 Cr (2.4% of revenue) focused on product design and cost reduction.

Logistics & Distribution

Not disclosed as a specific percentage of revenue.

📈 Strategic Growth

Expected Growth Rate

15-20%

Growth Strategy

Growth is underpinned by a record order book of INR 1.96 lakh Cr (6.9x revenue visibility). Strategy involves capitalizing on the thermal power revival (24.5 GW orders received in FY24-25), diversifying into Railways (Vande Bharat), Defence, and Nuclear power, and a JV for Coal Gasification.

Products & Services

Boiler-Turbine-Generators (BTG), hydro turbines, nuclear power plant equipment, electric locomotives (traction), naval guns, solar EPC, and coal gasification plants.

Brand Portfolio

BHEL (Maharatna PSU status), Harit BHEL (Sustainability initiative).

New Products/Services

Coal-to-chemicals (gasification), high-efficiency thermal plants, and green hydrogen initiatives are expected to contribute to future revenue.

Market Expansion

Targeting expansion in the 800 MW thermal segment (where it holds >80% market share) and increasing presence in 91 countries.

Market Share & Ranking

Leading market position in India's BTG segment with over 50% of the country's installed conventional power capacity.

Strategic Alliances

Joint Venture with Coal India Limited (CIL) for a coal gasification project (49% BHEL stake).

🌍 External Factors

Industry Trends

The industry is seeing a resurgence in thermal power (25 GW pipeline) alongside a shift toward green energy and net-zero goals by 2047. BHEL is positioning itself via 'Harit BHEL' and coal gasification.

Competitive Landscape

Dominant player in thermal; faces competition in renewables and international EPC from global engineering firms.

Competitive Moat

Moat consists of Maharatna status, 63.17% GoI ownership providing financial flexibility, and high technical entry barriers in the 800 MW BTG segment. Sustainability is high due to the 6.9x order-book-to-revenue ratio.

Macro Economic Sensitivity

Highly sensitive to Government of India energy planning; the ordering of 25 GW thermal projects since FY23 is a primary growth driver.

Consumer Behavior

Shift in government policy toward reviving thermal power to meet base-load demand while simultaneously pursuing decarbonization.

Geopolitical Risks

Exposure to global supply chains for specialized components, though 'Atmanirbhar Bharat' initiatives aim to reduce this.

⚖️ Regulatory & Governance

Industry Regulations

Subject to DPE Guidelines on Corporate Governance and SEBI Listing Regulations. Must comply with environmental standards for heavy manufacturing.

Environmental Compliance

Committed to Net Zero by 2047. Operates 21 effluent treatment plants and 19 sewage treatment plants.

Taxation Policy Impact

Not specifically disclosed; follows standard corporate tax rates for PSUs.

Legal Contingencies

BSE and NSE each imposed a fine of INR 5,42,800 (total INR 10.85 lakh) for non-compliance with Regulation 17(1) regarding Board composition (Independent Directors < 50%) for the quarter ending Sept 2025.