BHEL Shares Soar to 52-Week High with Rs 15,000 Crore Contract Win

Bharat Heavy Electricals Ltd (BHEL) witnessed a surge in its shares by over 4%, reaching a 52-week high on Monday. This upswing came after the announcement of a contract win valued at ₹15,000 cr. As the stock opened higher it rallied further by 4.68% hitting a year's peak at ₹205.60 on the BSE and the trading volume exceeded 16 lakh shares.

Stock Performance and Contract Details

Over the last three months, BHEL's stock has displayed robust growth, rallying more than 56%. In 2023 alone the company's shares recorded an astounding gain of 150%. BHEL secured an engineering, procurement, and construction (EPC) contract from NLC India Ltd for the 3x800 MW Talabira thermal power project in Odisha's Jharsuguda district. The contract's total value surpasses ₹15,000 crore, excluding taxes and duties.

EPC contract includes the supply of crucial equipment, including boilers, turbines, generators and associated auxiliaries. BHEL will be responsible for erection, commissioning, and related civil works for the Talabira thermal project. The manufacturing of project equipment will occur at various BHEL plants across India, including Haridwar, Hyderabad, Trichy, Bengaluru, Jhansi, Bhopal, Ranipet, Varanasi, and Rudrapur.

The project is slated to be commissioned within 64 months from the Letter of Award (LoA). NLC India Ltd had previously announced securing 2,400 MW through Power Purchase Agreements (PPAs) with Tamil Nadu, Odisha, Kerala, and Puducherry. Fuel linkage for the project is established from NLC India's Talabira II & III OCP mines, operational since 2020 in Odisha's Jharsuguda and Sambalpur districts.

The project will use water from the Hirakud Reservoir. NLC India is going green by designing boilers that can use biomass alongside regular fuel. They're incorporating advanced pollution control tech to meet environmental guidelines. The first unit is set to launch in the fiscal year 2028-29.

Financial Snapshot

In the second quarter of the financial year 2023-24, BHEL reported a loss of ₹238.12 cr, a shift from the ₹12.10 crore profit in the previous fiscal year. Total income for this quarter dropped from ₹5,418.74 crore to ₹5,305.38 crore compared to the same period last year.

Final Words

BHEL's recent contract success not only made its shares reach a one year high but also established a stronger position in power projects. The Talabira thermal power project is a major milestone for both BHEL and NLC India Ltd due to its contract value and broad scope.