The stock of Bharat Heavy Electrical ( BHEL BSE 0.53 %) gained 27 per cent in a month following a spate of orders from state utilities.
The company is expected to clock order growth of more than 45 per cent in the current fiscal based on the current momentum. This will start a new execution cycle and may treble earnings per share for the next fiscal.The company has bagged orders worth Rs 12,000 crore in the March quarter so far which includes contracts from the state electricity boards (SEBs) of Tamil Nadu and Telangana.
The company is the lowest bidder in projects worth more than Rs 30,000 crore. It recently won the Maitree Power project of 1,320 MW worth Rs 10,500 crore, which is a joint venture of NTPCBSE 0.31 % and Bangladesh power development boards.
The street estimates a conservative order inflow of Rs 35,000-40,000 crore for the next year due to the paucity of orders. If company is able to surpass the expectation, it may result in substantial earnings upgrades.
Apart from the order growth, favourable valuation has prompted investors to take fresh exposure when the stock was briefly trading below Rs 100 in February.