BHEL to share Q1 results today. Here's earnings preview

Bharat Heavy Electricals Limited (BHEL) will be reporting its June quarter results on Friday and analysts are unsure whether the capital goods major will deliver profit for the quarter. They see sales for the state-run engineering and manufacturing company rising 7-15 per cent for the quarter. 

Kotak Institutional Equities expects BHEL to report a widening of losses to Rs 217.60 crore for the quarter compared with a loss of Rs 191.90 crore in the year-ago quarter. Net sales is seen rising 7.1 per cent YoY to Rs 5,004 crore from Rs 4,672 crore in the year-ago quarter.

"We expect 6 per cent YoY improvement in revenues driven by the industrial segment; we expect marginal decline in power segment revenues. We expect Ebitda to remain negative on weak executable backlog and seasonality. We expect employee cost to remain elevated. We also expect other expenses to move up. Previous quarters had the benefit of provision write-back in other expenses," Kotak Institutional Equities said.

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Brokerage Prabhudas Lilladher expects BHEL to report a profit of Rs 46.40 crore for the June quarter against a loss of Rs 191.90 crore in the same quarter last year. It sees sales rising 15.2 per cent YoY to Rs 5,379.80 crore.

"Revenue is expected to grow 15 per cent YoY, led by pickup in execution amid low base. Management commentary on execution pace, working capital situation, order pipeline, diversification into non-power segment, margins will be key monitorables,” it said.

BHEL has fixed August 11 as the record date for the purpose of determining the eligibility of the members to receive final dividend of Re 0.40 per share for the year FY23. The dividend, if approved by the members at the ensuing 59th AGM will be paid within 30 days from the date of declaration of dividend i.e. on or before September 22. The AGM will be held on August 24. BHEL commands a dividend yield of 0.43 per cent.

BHEL reported a 10 per cent increase in revenue for FY23, with the spares business growing 25 per cent. Ebitda for the year increased 11 per cent YoY, on the back of controlled administrative expenses. Revenue per employee increased 14 per cent, signalling improved manpower productivity.

Tax refunds of Rs 266 crore helped improve the bottom-line for the quarter. The company's order book stood at Rs 91,340 crore (net taxes), with Rs 23,550 crore worth of orders booked in FY23 (net taxes).

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