BHEL plummets 8% on Q3 loss; analysts see up to 43% downside
NEW DELHI: Shares of BHEL plunged over 8 per cent in Monday’s trade after the state-run engineering firm reported a consolidated net loss of Rs 217.86 crore for the October-December quarter due to lower revenues.
The consolidated net profit of the firm was Rs 161.81 crore in the quarter ended on December 31, 2019, a BSE filing stated. The scrip also fell on a media report suggesting that the government may consider BHEL among candidates for the next round of divestment sales.
The stock fell 8.49 per cent to hit a low of Rs 39.85 over Friday’s close of Rs 43.55. Nomura India has a target of Rs 25 on the stock, suggesting a potential 43 per cent downside over Friday’s close. The foreign brokerage noted that BHEL continued to see operational cash inflows but at a reduced pace. It said that the orders remained weak and noted that recent orders appear to have been on a lower gross margins, as gross margin for the quarter at 30 per cent was significantly lower than historic levels.
