BHEL - Swing Trade Analysis with AI Signals

Last Updated Time : 05 Nov 25, 7:43 am

Swing Trade Rating: 3.9

📈 BHEL is a good short-term swing trade candidate with strong momentum and recent earnings rebound. Entry near ₹260 is optimal. If already held, consider exiting around ₹272–₹280.

📈 Positive

• 📈 MACD at 7.34 and RSI at 77.0 indicate strong bullish momentum.
• 📈 Trading above DMA 50 (₹239) and DMA 200 (₹236) confirms a strong uptrend.
• 📈 Quarterly PAT improved from a loss of ₹455 Cr. to a profit of ₹368 Cr. (↑280%).
• 📉 Debt-to-equity ratio of 0.44 is manageable for a capital-intensive PSU.
• 📈 DII holding increased by 0.17%, showing domestic institutional confidence.

⚠️ Limitation

• 💸 Stock P/E of 172 vs industry average of 49.8 suggests steep overvaluation.
• 📉 ROCE of 4.75% and ROE of 2.00% reflect weak capital efficiency.
• 📉 PEG ratio of 23.8 indicates expensive growth expectations.
• 📉 Volume below average (98.5L vs 291.4L), suggesting fading momentum.
• 📉 FII holding declined by 0.13%, showing cautious foreign sentiment.

📉 Company Negative News

• 📉 Analysts remain cautious due to historically inconsistent earnings and low return ratios.
• 📉 Concerns persist over execution delays and margin pressure in legacy contracts.

📈 Company Positive News

• 📈 BHEL posted a surprise profit turnaround in Q2, driven by higher execution and cost control.
• 📈 Management expects strong order inflows from power and defense sectors in H2.

⚙️ Industry

• ⚙️ Capital goods sector is gaining momentum with rising infrastructure and defense capex.
• 📊 Industry P/E of 49.8 reflects moderate optimism across peers.

✅ Conclusion

• 📈 BHEL is a good swing trade candidate with strong technical momentum and earnings recovery.
• 📉 Optimal entry price: ₹258–₹262 (on minor pullback from overbought zone).
• 📈 Exit target: ₹272–₹280 (near 52-week high and psychological resistance).
• 📌 Monitor RSI for signs of reversal and volume confirmation before entry.

I can chart BHEL’s RSI and MACD trends to help visualize its momentum setup—just let me know.