VALUATION
BHEL is the largest engineering and manufacturing enterprise in India in the energy related/ infrastructure sector. It manufactures over 180 products under 30 major product groups and caters to core sectors of the Indian economy viz., power generation and transmission, industry, transportation, telecommunication, renewable energy. AT CMP of Rs1500, the stock is trading at 21 x its FY09E EPS of Rs72. Chinese currency appreciating against Indian Rupee by 21% in last six months is positive for overall Indian capital good sector as competitive pricing edge which Chinese companies where enjoying will take a hit. BHEL secured highest orders worth Rs.50,265 cr during the year, from domestic and overseas markets. Currently order book stands at Rs. 91,417 Cr - which is 3.7 times its sales. We recommend investors to accumulate the stock at current levels.
(Rs crores)
Order book
Net Sales
Orderbook/sales
Price
EPS
P/E
BHEL
91417
19365
4.7
1500
58.41
25.7
52680
24854
2.1
2380
72.21
33.0
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