BHEL - Technical Analysis with Chart Patterns & Indicators

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

Technical Rating: 3.9

📈 BHEL is currently trending upward with strong momentum indicators and price action above key moving averages. However, overbought RSI and valuation concerns suggest caution for short-term entries.

📊 Technical Analysis Summary

• Trend Status: Trending upward
• RSI (76.7): Overbought — strong momentum, but risk of pullback
• MACD (4.95): Positive crossover — confirms bullish momentum
• Volume: Slightly below 1-week average — moderate conviction
• DMA 50 & 200: Price above both — confirms bullish structure
• Bollinger Bands: Price near upper band — momentum strong, but stretched

🎯 Entry & Exit Zones

• Support Levels: ₹255, ₹245, ₹237
• Resistance Levels: ₹272, ₹280, ₹295
• Optimal Entry: ₹255–₹260 (on pullback)
• Exit Target: ₹280–₹295 (short-term resistance)

✅ Positive

• Quarterly PAT turnaround from ₹-455 Cr to ₹368 Cr — 280% improvement
• Price above 50 DMA and 200 DMA — confirms bullish trend
• MACD and RSI show strong momentum
• DII holding increased by 0.17% — domestic investor confidence

⚠️ Limitation

• RSI above 70 — overbought zone, risk of correction
• High P/E (170) and PEG (23.6) — severe overvaluation
• Low ROE (2.00%) and ROCE (4.75%) — weak capital efficiency
• Dividend yield of 0.19% — low income potential

📉 Company Negative News

• FII holding declined by 0.13% — slight institutional caution
• Valuation premium over industry PE — risk of re-rating

📈 Company Positive News

• Strong quarterly earnings recovery
• Stock up 92.6% from 52-week low — strong performance

🏭 Industry

• Sector: Capital Goods / Engineering
• Industry P/E: 51.6 vs BHEL’s P/E: 170 — significantly overvalued
• Sector outlook supported by infrastructure and energy investments

🧾 Conclusion

• BHEL is in a bullish trend with strong technical indicators
• Entry near ₹255–₹260 with targets at ₹280–₹295
• Monitor RSI and volume for signs of exhaustion or continuation
• Valuation remains stretched; short-term traders may benefit from momentum, long-term investors should be cautious