Buy BEML, target price Rs 1675: HDFC Securities

HDFC Securities has buy call on BEML with a target price of Rs 1675. The current market price of BEML Ltd. is Rs 1437.35.

Time period given by analyst is six months when BEML Ltd. price can reach defined target.

BEML Ltd., incorporated in the year 1964, is a Mid Cap company (having a market cap of Rs 5973.07 Crore) operating in Engineering sector.


BEML Ltd. key Products/Revenue Segments include Railway Items, Earth Moving Equipments, Spare Parts & Others, Sale of services, Defence Items, Scrap, Wind Energy for the year ending 31-Mar-2019.

Financials
For the quarter ended 30-06-2021, the company reported a Consolidated Total Income of Rs 470.31 Crore, down -73.96 % from last quarter Total Income of Rs 1806.17 Crore and up 16.77 % from last year same quarter Total Income of Rs 402.78 Crore. Company reported net profit after tax of Rs -94.01 Crore in latest quarter.

Investment Rationale
The brokerage believes BEML is well-placed to capitalize on the opportunities in mining, defence and Railways & Metro space. The mining sector, which is now open for private sector participation, is likely to get a boost. Further, initiatives i.e.“Atmanirbhar Bharat”, “Make in India”, import ban on 101 items and hike in FDI limit in defence to 74%, along with strong ordering activities in railways and metro rail, augur well for BEML. Draft DPEPP policy, which has set ambitious revenue targets with intent to become self-reliant, provides good visibility of order book for BEML going forward.