Bhel charged up in late afternoon trades on Tuesday to figure as the biggest gainer in the BSE Sensex.
The scrip of the power equipment major jumped 4.54% to Rs 189 by 14:53 IST. Over 166,000 Bhel shares were exchanged on BSE till then. In four sessions between 28 January and 3 February 2003, Bhel lost 7% to Rs 180.80 from Rs 194.50.
Rumours that the Electricity Bill will be passed into a law soon has powered Bhel's progress on Tuesday. Market talk has it that foreign institutional investors are active in Bhel.
The Electricity Bill, meanwhile, is widely anticipated and will be wholseomely welcomed as it seeks to do away with the current restrictions on power generators and aims at reforming the sector. Analysts say the Bill will improve the power sector and health of State Electricity Board. This, in turn, will help Bhel improve its financials as the power equipment major receives 60% of its revenues from SEBs.
Last week, Bhel unveiled its third quarter ended 31 December 2002 results - a net profit rise of 1.5% to Rs 81.33 crore compared to Rs 80.15 crore in the corresponding period of the previous year. Total income increased by 14% to Rs 1,699.76 from Rs 1,490.17 crore in DQ 2001.
Meanwhile, analysts are hopeful that the company will register good performances in the coming quarters following its strong order book position. Bhel's order book stood at Rs 12,850.00 crore (Rs 128.5 billion) as at the end of December 2002. The order intake is estimated to grow by 20% despite one large order of BSES worth Rs 2,850 crore (Rs 28.5 billion) getting postponed in FY 2003-04. The management expects two large orders that will compensate for this shortfall Karnataka Power Corporation's 500 MW Bellary Project worth Rs 1,000 crore (Rs 10 billion) and the 500 MW Birsingpur Project promoted by the Madhya Pradesh State Electricity Board worth Rs 1,800 crore (Rs 18 billion).
Bhel is the largest engineering and manufacturing enterprise of its kind in India, and is one of the leading international companies in the field of power equipment manufacture. The Centre has decided to sell 17% equity stake in Bhel to bring down its holding in the company to 51% from 67.7%. The heavy industry ministry has granted its concurrence to the proposal for divesting 17% stake to the public, financial institutions and employees.
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