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BHEL: The Somber Performance Continues - Views on News from Equitymaster
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BHEL: The Somber Performance Continues
Jun 16, 2017

BHEL has announced fourth quarter results for the financial year 2016-2017. The company has reported a 2% YoY dip in sales, and a 57% YoY fall in net profit during the period. Here is our analysis of the results.

Performance Summary
  • Net sales for the company fell 2% YoY during the quarter.
  • Operating profits fell 25% YoY during the current quarter.
  • Net profits saw a large 57% YoY decline.
  • The company ended the quarter with an order book of Rs 1,052 billion, a 5% YoY fall.
  • The company has declared payment of Rs 0.78 per share as final dividend for FY17. This is over and above the interim of Rs 0.80 per share for the year paid earlier.

    Financial performance: A snapshot
    (Rs m) 4QFY16 4QFY17 Change FY16 FY17 Change
    Sales 100,997 98,743 -2.2% 260,501 288,404 10.7%
    Other operating income 3,091 2,832 -8.4% 5,883 6,346 7.9%
    Expenditure 95,426 95,067 -0.4% 280,050 283,741 1.3%
    Operating profit (EBDITA) 8,661 6,509 -24.9% -13,667 11,009  
    Operating profit margin (%) 8.3% 6.4%   -5.1% 3.7%  
    Other income 4,617 1,452 -68.5% 14,977 7,264 -51.5%
    Interest 3,466 3,136 -9.5% 3,595 3,506 -2.5%
    Depreciation 2,428 2,139 -11.9% 9,357 8,488 -9.3%
    Profit before tax 7,384 2,686 -63.6% -11,642 6,278  
    Tax 2,327 530 -77.2% -4,546 1,320  
    Profit after tax/(loss) 5,057 2,155 -57.4% -7,096 4,959  
    Other comprehensive income -228 68   -764 -290  
    Total comprehensive income 4,829 2,224   -7,860 4,669  
    Net profit margin (%) 4.9% 2.1%   -2.7% 1.7%  
    No. of shares         2,448  
    Basic & Diluted earnings per share (Rs)*         2.0  
    P/E ratio (x)*         69.1  

    * On a trailing 12-months basis


    Segment-wise performance
    (Rs m) 4QFY16 4QFY17 Change FY16 FY17 Change
    Power            
    Revenue 78,653 81,090 3.1% 202,227 227,948 12.7%
    % share 78% 82%   78% 79%  
    PBIT margin 14.0% 13.9%   0.6% 11.1%  
    Industry            
    Revenue 22,344 17,653 -21.0% 58,273 60,456 3.7%
    % share 22% 18%   22% 21%  
    PBIT margin -2.6% 15.2%   -3.3% 4.0%  
    Gross Total*            
    Revenue 100,997 98,743 -2.2% 260,501 288,404 10.7%
    PBIT margin 10.3% 14.2%   -0.3% 9.6%  

    * Excluding inter-segment adjustments & Excise Duty

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