On August 7, 2025, Bharat Heavy Electricals Limited (BHEL) saw its share price drop sharply on the National Stock Exchange (NSE). The stock fell nearly 5%, reaching an intraday low of ₹228.12, down from its previous close of ₹239.83. This steep decline came after the company posted disappointing financial results for the first quarter of FY26. Heavy trading volumes were also seen, as over 10 million shares changed hands throughout the day.
BHEL Q1 FY26 Results Shock Investors
BHEL reported a consolidated net loss of ₹455.5 crore for Q1 FY26, which was more than double the ₹211 crore loss it recorded in the same quarter last year. The company’s revenue remained flat, ranging between ₹5,486 crore and ₹5,658 crore. However, expenses surged to ₹6,280 crore, indicating serious cost pressures and operational challenges.
This unexpected performance raised concerns about the company’s ability to control costs and manage project execution. Many investors reacted by selling their holdings, leading to the sharp fall in stock price.
Stock Performance – Short-Term Pain, Long-Term Gain?
BHEL’s recent price action has been rough.
- The stock fell around 6% in just one day and
- Dropped nearly 7.8% over the last month.
- On a year-on-year basis, it has declined between 16% and 26%, depending on the source.
However, looking at the longer-term, the stock has delivered strong returns over the past 3 to 5 years. It has gained several hundred percent since its lows, largely supported by hopes of a turnaround in the power and infrastructure sectors.
Still, the current weakness has made some investors cautious, especially as short-term risks remain high.
Analysts Stay Bullish Despite Weak Numbers
Interestingly, many brokerages continue to maintain a “Buy” rating on BHEL, signaling their belief in the company’s longer-term potential.
- Nuvama cut its target from ₹360 to ₹335 but remains positive due to the revival in thermal power projects and a strong order book.
- JM Financial has kept a target of ₹278, expecting earnings recovery from Q3 FY26.
- UBS also initiated coverage with a “Buy” rating and a target price of ₹340.
- On the other hand, TipRanks is more cautious, with a “Hold” rating and a target of around ₹242.
Valuation platform AlphaSpread estimates that BHEL may be undervalued by nearly 34%, suggesting a base-case intrinsic value of ₹343.
These varying opinions show that while short-term challenges are clear, some market experts are looking past them to the company’s growth potential in infrastructure and energy.
Technical Signals Flash Bearish Warnings
From a technical perspective, BHEL’s stock is showing signs of weakness:
- Relative Strength Index (RSI) is at 26.4, suggesting it is deep in oversold territory.
- MACD is negative, confirming the downward trend.
- A 50-day moving average “sell crossover” has appeared, a signal that often leads to a 6% decline in the following month based on past data.
These bearish indicators suggest that further downside is possible in the short term, unless there’s a positive catalyst such as new orders or favorable government announcements.
Conclusion: Mixed Sentiment as BHEL Faces Tough Quarter
BHEL’s disappointing Q1 results have led to a sharp drop in share price, causing concern among investors. The company’s higher losses and flat revenue show that cost control and execution remain major issues.
At the same time, long-term investor sentiment remains cautiously optimistic, backed by the company’s important role in India’s infrastructure and power sector growth. Analysts still recommend buying the stock with target prices between ₹278 and ₹340, though technical signals advise short-term caution.
With heavy trading and high volatility, BHEL has become a stock to watch—as markets wait to see if the company can turn things around in the upcoming quarters.
F.A.Q.
– Why did BHEL’s share price fall on August 7, 2025?
BHEL’s share price dropped nearly 5% due to weak Q1 FY26 results, where the company reported a net loss of ₹455.5 crore, more than double the previous year’s loss. This raised concerns about rising costs and execution delays.
– What was BHEL’s trading range and volume on August 7, 2025?
On the NSE, BHEL traded between ₹224.71 and ₹232.69. Over 10 million shares were traded, indicating heavy investor activity following the earnings announcement.
– What are analysts saying about BHEL stock now?
Despite the poor Q1 results, brokerages like Nuvama, JM Financial, and UBS still maintain Buy ratings, with price targets ranging from ₹278 to ₹340, citing long-term growth potential and order pipeline strength.
– Is BHEL considered undervalued at current levels?
According to AlphaSpread, BHEL may be undervalued by around 34%, with an estimated intrinsic value of ₹343, suggesting room for long-term upside despite near-term pressure.
– What do technical indicators say about BHEL’s near-term movement?
Technical signals are strongly bearish, with a low RSI of 26.4 and a negative MACD. A 50-day moving average sell crossover also points to potential further downside in the short term.
Also read:-