UBS downgrades BHEL shares to Neutral from Buy. Check target, key reasons

#sr_widget.onDemand p, #stock_pro.onDemand p{font-size: 14px;line-height: 1.28;}
.onDemand .live_stock{left:17px;padding:1px 3px 1px 5px;font-size:12px;font-weight:600;line-height:18px;top:9px}
#sr_widget.onDemand .sr_desc{margin:0 auto 0;}
#sr_widget.onDemand .sr_desc{color: #024d99;margin-top:10px;}
#sr_widget.onDemand .crypto .live_stock .lb-icon{8px 6px 5px 3px !important}
#sr_widget.crypto.onDemand a.text{border-bottom:1px solid #ccc;padding-bottom:5px;display:block;width:100%}
#sr_widget.onDemand .sr_desc .text p, #stock_pro.onDemand .sr_desc .text p{font-size:12px;font-weight:400;}
UBS believes a significant portion of the company’s order book expansion is already behind it and noted that competition has intensified over the last three years, with rivals such as L&T and Thermax displaying a stronger appetite for new orders. The brokerage said the stock’s risk-reward profile has become more balanced after BHEL outperformed the Nifty by nearly 60% over the past 12 months.

Despite the downgrade, UBS remains constructive on BHEL’s long-term outlook. It expects a steady flow of orders from the thermal power and industrial segments and believes the company’s multi-year revenue visibility does not warrant a “Sell” rating.

The brokerage continues to hold earnings estimates above the Street’s expectations and has raised its FY27 and FY28 earnings forecasts by 1-3%. It has also increased its valuation multiple to 28x from 25x, factoring in a meaningful ramp-up in execution and an improvement in gross margins. UBS further noted that the order book accumulated during FY23-FY26, when BHEL captured an estimated 75-80% market share, provides strong revenue visibility through FY30.

Last month, the PSU company reported a whopping 156% surge in its consolidated net profit to Rs 1,290.50 crore for the January-March quarter of the financial year 2026. Sequentially, net profit saw a sharper rise of nearly 231% from the Rs 390.40 crore reported in the third quarter of the financial year 2026.
a:hover{text-decoration:none;}
.liveEventMain_widget{margin-top:15px;padding-top:24px;border-top:2px solid #000;position:relative;font-family:Montserrat;}
.liveEvent_slider{position:relative;overflow:hidden;}
.liveEvent_slider ul{white-space:nowrap;list-style:none;margin-top:12px;}
.liveEvent_slider ul.sliderContainer{margin-bottom:30px;}
.liveEvent_slider ul li{white-space:normal;width:282px;vertical-align:top;display:inline-block;margin-right:12px;border-radius:12px;box-shadow: 0px 4px 12px 0px #2407461F;background-color:#fff;overflow: hidden;}
.images_wrap{position:relative;}
.images_wrap .cover_img{object-fit:cover;object-position:center;border-top-left-radius:4px;border-top-right-radius:4px;}
.images_wrap .author_img{position:absolute;left:10px;top:13px;border-radius:10px;}
.images_wrap::before{background-image: linear-gradient(180deg, rgba(11, 11, 46, 0) 20.31%, rgba(11, 11, 46, .6) 61.46%, #0b0b2e);content: “”;height: 100%;left: 0;position: absolute;right: 0;width: 100%;}
.liveEventMain_widget .details{padding:12px;}
.liveEventMain_widget .category{font-size:12px;line-height:14px;font-weight:700;color:#6a11b0;margin-bottom:8px;}
.liveEventMain_widget .course_name{font-size:16px;line-height:20px;font-family:Faustina;-webkit-line-clamp:2;overflow:hidden;height:40px;display:-webkit-box;-webkit-box-orient:vertical;font-weight:600;color:#000;}
.liveEventMain_widget .details .author_name{font-size:13px;line-height:16px;color:#333;font-weight:400;margin-top:4px;-webkit-line-clamp:2;overflow:hidden;height:32px;display:-webkit-box;-webkit-box-orient:vertical;}
.liveEventMain_widget .view{border: 1.5px solid #D51131; display: block; padding: 8px 0; text-align: center; border-radius: 4px; font-size: 14px; line-height: 16px; color: #D51131; margin-top: 12px; width: 100%; font-family: Montserrat; font-weight: 600; cursor: pointer;}
.liveEventMain_widget .view span{display: inline-block; width: 6px; height: 6px; border-top: 1.5px solid #ed193b; border-left: 1.5px solid #ed193b; transform: rotate(90deg); position: relative; left: 5px; top: -2px;}
.liveEventMain_widget .view span::after{content: ”; display: inline-block; width: 11px; border-top: 1.5px solid #ed193b; transform: rotate(45deg); position: absolute; top: 3px; left: -2px;}
.liveEventMain_widget .arrow_btn{width: 26px; height: 25px; position: absolute; z-index: 11; background-size: 312px; cursor: pointer;}
.liveEventMain_widget .nextprev-btn{display:inline-block;width: 100%; position: absolute; top: 59%;}
.liveEventMain_widget .prev-btn{background-position: -212px -2px;left: -12px;}
.liveEventMain_widget .next-btn{background-position: -241px -2px; right: -3px;left:unset;}
.liveEventMain_widget .arrow_btn.disable{opacity:0.5;}
.liveEventMain_widget .ts-dots{display:inline-block;position:absolute;top:34px;right:10px;}
.liveEventMain_widget .ts-dots ul{display:inline-block;}
.liveEventMain_widget .ts-dots li{width:7px;height:7px;border-radius:50%;background-color:#cdcdcd;margin:0 2px;display:inline-block;}
.liveEventMain_widget .ts-dots li span{display:none;}
.liveEventMain_widget .ts-dots li.active{background-color:#ed193b;}
.liveEventMain_widget .topContain {
display: flex;
align-items: center;
gap: 6px;
}
.liveEventMain_widget .topContain .imgBox {
max-width: 40px;
}
.liveEventMain_widget .topContain .logoTitle {
font-family: “Montserrat”, “Verdana”;
font-weight: 700;
font-size: 20px;
line-height: 100%;
}
.liveEventMain_widget .topContain .logoSubTitle{
position: relative;
font-size: 18px;
font-weight: 500;
line-height: 1.2;
color: #747474;
margin-left: 24px;
}
.liveEventMain_widget .topContain .logoSubTitle:before{
content:”;
position: absolute;
left: -13px;
top: 0;
width: 1px;
height: 100%;
background-color: #838383;
}
.liveEventMain_widget .liveEvent_slider .liveEventCardContainer{
}
.liveEventMain_widget .liveEvent_slider .liveEventCardContainer .liveEventCard{
display: flex;
}
.liveEventMain_widget .liveEvent_slider .liveEventCardContainer .liveEventCoverImg{
}

Live Events

BHEL’s revenue from operations meanwhile grew 37% YoY to Rs 12,310 crore in Q4 FY26, from Rs 8,993 crore in Q4 FY25. The company’s EBITDA more than doubled to Rs 2,005 crore during the quarter under review, from Rs 990 crore in the year-ago period.

For the entire financial year 2026, BHEL saw its net profit surge 200% to Rs 1,600.26 crore, from Rs 533.90 crore in FY25. Revenue, meanwhile, grew 19% YoY to Rs 33,782 crore for the financial year, which ended on March 31, 2026.

BHEL shares have risen 38% since the beginning of 2026 and about 50% in the last 1 year.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
#sr_widget.onDemand p, #stock_pro.onDemand p{font-size: 14px;line-height: 1.28;}
.onDemand .live_stock{left:17px;padding:1px 3px 1px 5px;font-size:12px;font-weight:600;line-height:18px;top:9px}
#sr_widget.onDemand .sr_desc{margin:0 auto 0;}
#sr_widget.onDemand .live_stock p a{color: #fff;;}
#sr_widget.onDemand .sr_desc{color: #024d99;margin-top:10px;}
#sr_widget.onDemand .crypto .live_stock .lb-icon{8px 6px 5px 3px !important}
#sr_widget.crypto.onDemand a.text{border-bottom:1px solid #ccc;padding-bottom:5px;display:block;width:100%}
#sr_widget.onDemand .sr_desc .text p, #stock_pro.onDemand .sr_desc .text p{font-size:12px;font-weight:400;}

.Pbanner{display:flex;justify-content:space-between;align-items:center;background-color:#ec1c40;margin-top:20px;padding:5px 10px;border-radius:4px;color:#fff;line-height:10px;}
.Pbannertext{display:flex;align-items:center;font-size:16px;font-weight:600;font-family:’Montserrat’;}
.Pbannertext img{height:20px;margin:0 6px}
.Pbannerbutton a{display:flex;align-items:center;background-color:#fff;color:#ec1c40;text-decoration:none;font-weight:600;padding:4px 8px;border-radius:6px;font-size:15px;font-family:’Montserrat’;}
.Pbannerbutton img{height:20px;margin-right:6px}
.Pbannerbutton a:hover{background-color:#f7f7f7}

Add as a Reliable and Trusted News Source

Add Now!

(You can now subscribe to our ETMarkets WhatsApp channel)