BEML shares tumble 7% on profit booking; analysts advise buying on dips

Shares of BEML Ltd (formerly Bharat Earth Movers Ltd) declined sharply on Tuesday, ending a strong two-day upmove as investors booked profits. The stock declined 6.52 per cent to touch a day low of Rs 4,475, triggering concerns among short-term traders. Analysts, however, maintained a positive long-term view on the stock.

Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, pointed out the company's robust fundamentals. "BEML has a strong order book and remains focused on the defence and railway sectors. Long-term investors can consider buying the stock on corrections," Bathini said.

Kunal Kamble, Senior Technical Research Analyst at Bonanza Portfolio, highlighted the technical dynamics behind the sell-off. "The stock witnessed profit booking today, and this corrective phase may extend in the near term. We see potential downside towards the Rs 3,964 level -- a zone that earlier saw intense selling pressure. However, this decline presents a buying opportunity as the overall structure still indicates a move towards Rs 5,400 in the coming months," Kamble noted.

He further cautioned that the broader defence sector, which has surged nearly 45.43 per cent since April 1, 2025, may be entering a consolidation phase. "The sector has significantly outperformed the Nifty50, which has risen just about 9 per cent in the same period. Given this sharp outperformance, aggressive buying should be avoided. Instead, investors should remain light and use healthy retracements to add quality names," Kamble advised.

BEML, a public sector undertaking under the Ministry of Defence, operates in strategic sectors such as defence, railways, mining, power and construction. As of March 2025, the government held a 54.03 per cent stake in the company.

Looking ahead, Kamble noted that broader market sentiment remains constructive. "If Nifty sustains above 25,300, it could move towards 25,500 and 25,800. While global tensions remain a factor, any easing could improve sentiment and fuel a gradual market uptrend. As long as Nifty stays above 24,500, dips should be seen as opportunities," he said.