IIFL has a reduce on BHEL, target price Rs 59

IIFL has a reduce rating on BHEL in the long term with a target price of Rs 59. The stock ended down 3.2% at Rs 46.85 on Tuesday while the BSE Sensex closed 361.92 down at 38,305.41. The equity market was closed on Tuesday on account of Gandhi Jayanti.

Company Financials

For the quarter ended 30-06-2019, the company has reported consolidated sales of Rs 4411.09 crore, down -55.16% from last quarter sales of Rs 9838.35 crore and down -23.90% from last year same quarter sales of Rs 5796.70 crore. The company has reported net profit after tax of Rs -224.31 crore in the latest quarter.


Investment Rationale

Acceleration in execution, realisation of cash on project closures, and diversification and upgrade of product portfolio are the key focus areas of the new chairman, said IIFL. At 0.6 times price-to-book value, downside risks are limited, but re-rating is some time away and will be led by sustained uptick in orders and balancesheet repair, said IIFL.