Maharatna PSU stock to buy: Brokerage turns bullish on BHEL, target indicates nearly 40% upside

PSU Stock to BUY: Shares of Bharat Heavy Electricals Ltd (BHEL) were in focus on Monday after domestic brokerage ICICI Securities turned bullish on the Maharatna PSU, citing improving execution and a strong long-term outlook for India’s power sector. The stock was trading around Rs 270.

In its latest report, the brokerage said BHEL’s order book remains robust, with consistent order inflows over the past three years. However, the company’s execution pace has lagged. With signs of a pickup now emerging, ICICI Securities expects execution to strengthen meaningfully from H2FY26E, with a major improvement likely in FY27.

Why the brokerage is bullish on BHEL

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According to sector projections, coal-based power capacity will remain relevant even beyond 2032. Reports indicate NTPC alone may add over 13 GW of coal capacity between 2032–37, while NITI Aayog has set a target of 420 GW coal capacity by 2047. Additionally, India aims to ramp up nuclear capacity to 100 GW over the long term—all of which strengthens BHEL’s growth visibility.

Factoring these trends, ICICI Securities issued a ‘Buy’ rating on BHEL with a target price of Rs 370, implying 38 per cent upside from current levels.

Stock performance

Despite the positive outlook, BHEL shares have fallen 7 per cent in the past week. Over the past one month, the stock has gained around 2.5 per cent, risen 24 per cent in three months, and delivered 16 per cent return year-to-date.

BHEL, a Maharatna PSU with a market cap of around Rs 93,900 crore, has 63.17 per cent government ownership. Public shareholders hold 36.83 per cent, with 35 mutual funds together owning 7.64 per cent. Retail investors account for 10.34 per cent, while FIIs and DIIs held 6.23 per cent and 18.62 per cent, respectively, as of the September quarter.

About the company

BHEL is a leading engineering and manufacturing PSU operating across the power and industrial sectors. The company supplies equipment and services for thermal, nuclear, and hydro power projects—having contributed to 54 per cent of India’s thermal, 56 per cent of nuclear, and 46 per cent of hydro capacity. It has presence in 91 countries, 13 GW of installed capacity, and operates 16 manufacturing units.