BHEL: Margins Dip into the Negative - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

StockSelect
  • MyStocks
MEMBER'S LOGIN

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

BHEL: Margins Dip into the Negative

Aug 14, 2017 | Updated on Oct 30, 2019

BHEL has announced first quarter results for the financial year 2017-2018. The company has reported a 2% YoY dip in sales, and a 3.9% YoY rise 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 slipped into the negative as costs remained higher.
  • Net profits saw a 3.9% YoY increase due to other income being significantly higher to the tune of 85% YoY.
  • The company ended the quarter with an order book of Rs 1,014 billion, a 6% YoY fall.
  • The company's board has recommended a bonus issue in the ratio of 1:2. Record date yet to be announced.

    Financial performance: A snapshot
    (Rs m) 1QFY17 1QFY18 Change
    Sales 57,212 56,070 -2.0%
    Other operating income 997 1,250 25.4%
    Expenditure 57,499 58,203 1.2%
    Operating profit (EBDITA) 710 -883 -224.3%
    Operating profit margin (%) 1.2% -1.5%  
    Other income 2,493 4,622 85.4%
    Interest 57 657 1,063.2%
    Depreciation 2,182 2,001 -8.3%
    Profit before tax 965 1,080 11.9%
    Tax 188 272 45.0%
    Profit after tax/(loss) 778 808 3.9%
    Net profit margin (%) 1.3% 1.4%  
    No. of shares   2,448  
    Basic & Diluted earnings per share (Rs)*   2.0  
    P/E ratio (x)*   62.3  
    *On a trailing 12-months basis

    Segment-wise performance
    (Rs m) 1QFY17 1QFY18 Change
    Power      
    Revenue 43,355 43,356 0.0%
    % share 76% 77%  
    PBIT margin 7.2% 10.1%  
    Industry      
    Revenue 13,857 12,714 -8.2%
    % share 24% 23%  
    PBIT margin 6.1% 6.3%  
    Gross Total*      
    Revenue 57,212 56,070 -2.0%
    PBIT margin 6.9% 9.3%  
    *Excluding inter-segment adjustments & Excise Duty
To Read the Full Story, Subscribe or Sign In
To Read the Full Story, Subscribe or Sign In



DISCLOSURES UNDER SEBI (RESEARCH ANALYSTS) REGULATIONS, 2014
INTRODUCTION:
Equitymaster Agora Research Private Limited (hereinafter referred to as "Equitymaster"/"Company") was incorporated on October 25, 2007. Equitymaster is a joint venture between Quantum Information Services Private Limited (QIS) and Agora group. Equitymaster is a SEBI registered Research Analyst under the SEBI (Research Analysts) Regulations, 2014 with registration number INH000000537.

BUSINESS ACTIVITY:
An independent research initiative, Equitymaster is committed to providing honest and unbiased views, opinions and recommendations on various investment opportunities across asset classes.

DISCIPLINARY HISTORY:
There are no outstanding litigations against the Company, it subsidiaries and its Directors.

GENERAL TERMS AND CONDITIONS FOR RESEARCH REPORT:
For the terms and conditions for research reports click here.

DETAILS OF ASSOCIATES:
Details of Associates are available here.

DISCLOSURE WITH REGARDS TO OWNERSHIP AND MATERIAL CONFLICTS OF INTEREST:
  1. 'subject company' is a company on which a buy/sell/hold view or target price is given/changed in this Research Report.
  2. Equitymaster has financial interest in BHEL.
  3. Equitymaster’s investment in the subject company is as per the guidelines prescribed by the Board of Directors of the Company. The investment is however made solely for building track record of its services.
  4. Equitymaster's Associates and Research Analyst or his/her relative doesn't have any financial interest in the subject company.
  5. Neither Equitymaster, it's Associates, Research Analyst or his/her relative have actual/beneficial ownership of one percent or more securities of the subject company at the end of the month immediately preceding the date of publication of the research report.
  6. Neither Equitymaster, it's Associates, Research Analyst or his/her relative have any other material conflict of interest at the time of publication of the research report.
  7. Equitymaster's technical team/other research services have given a 'Buy' and 'Buy at lower' view on BHEL.
DISCLOSURE WITH REGARDS TO RECEIPT OF COMPENSATION:
  1. Neither Equitymaster nor it's Associates have received any compensation from the subject company in the past twelve months.
  2. Neither Equitymaster nor it's Associates have managed or co-managed public offering of securities for the subject company in the past twelve months.
  3. Neither Equitymaster nor it's Associates have received any compensation for investment banking or merchant banking or brokerage services from the subject company in the past twelve months.
  4. Neither Equitymaster nor it's Associates have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past twelve months.
  5. Neither Equitymaster nor it's Associates have received any compensation or other benefits from the subject company or third party in connection with the research report.
GENERAL DISCLOSURES:
  1. The Research Analyst has not served as an officer, director or employee of the subject company.
  2. Equitymaster or the Research Analyst has not been engaged in market making activity for the subject company.
Definitions of Terms Used:
  1. Buy recommendation: This means that the investor could consider buying the concerned stock at current market price keeping in mind the tenure and objective of the recommendation service.
  2. Hold recommendation: This means that the investor could consider holding on to the shares of the company until further update and not buy more of the stock at current market price.
  3. Buy at lower price: This means that the investor should wait for some correction in the market price so that the stock can be bought at more attractive valuations keeping in mind the tenure and the objective of the service.
  4. Sell recommendation: This means that the investor could consider selling the stock at current market price keeping in mind the objective of the recommendation service.
Feedback:
If you have any feedback or query or wish to report a matter, please do not hesitate to write to us.

Get the Indian Stock Market's
Most Profitable Ideas

How To Beat Sensex Guide 2020
Get our special report, How to Beat Sensex Nearly 3X Now!
We will never sell or rent your email id.
Please read our Terms

BHEL SHARE PRICE


Nov 11, 2019 (Close)

TRACK BHEL

MORE ON BHEL

BHEL - EASUN REYROLLE COMPARISON

Compare Company With Charts

COMPARE BHEL WITH

OTHER USEFUL LINKS

MARKET STATS


ABOUT EQUITYMASTER

Since 1996, Equitymaster has been the source for honest and credible opinions on investing in India. With solid research and in-depth analysis Equitymaster is dedicated towards making its readers- smarter, more confident and richer every day. Here's why hundreds of thousands of readers spread across more than 70 countries Trust Equitymaster.

FREE NEWSLETTERS
PREMIUM PRODUCTS
QUICK LINKS
APPS
  • Get Equitymaster Android App on Google Play
  • Get Equitymaster iOS App on App Store
FOLLOW

Copyright © Equitymaster Agora Research Private Limited.

Whitelist | Refer | Terms | Privacy | Contact | About | Sitemap

Equitymaster Agora Research Private Limited (Research Analyst) 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407

All rights reserved. Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (Research Analyst) bearing Registration No. INH000000537 (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA, Canada or the European Union countries, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.