Antique Stock Broking has recommended 'Buy' on Bharat Heavy Electricals Ltd (BHEL) shares following a large order win worth Rs 21,000 crore, excluding taxes, from Meja Urja Nigam Private Limited (MUNPL) for setting up a 3x800 MW TPP on an EPC basis. With the single order, BHEL's order book has increased by 10 per cent. With one of the all-time high book to bill ratio of 7 times, Antique believes the key monitorables have shifted from order inflows to timely execution, coupled with improvement in gross margins and cash flows. The brokerage suggested a target of Rs 430 on the stock, suggesting 11 per cent potential upside over Monday's trading price of Rs 388.

The book-to-bill ratio in the capital goods sector measures the value of new orders received against the value of goods shipped and invoiced over a specific period. Antique said it sees an improvement in BHEL's operational performance as the recent order wins promise better-profit margins. In addition, nuclear power and coal gasification are meaningful opportunities providing future order inflow tailwinds, the brokerage said said.

"We retain our earnings estimates and target price of Rs 430, based on 31 times FY28E earnings. Notably, our target multiple remains at a discount to Thermax’s valuation (45 times FY28E), reflecting relative positioning within the peer set," Antique said.

Besides the MUNPL order win, BHEL has also secured an order worth Rs 2,000–2,500 crore for the design, manufacturing, supply, and supervision of the erection and commissioning of eight gas turbine generator packages for a petroleum refinery and polypropylene plant in the Dangote Industries Free Zone, Nigeria. With these order wins of Rs 23,000-23,500 crore in YTDFY27, BHEL has started the fiscal 2027 on a strong note that should enable it to meet FY27 power sector target order intake of Rs 76,800 crore, Antique said.

The domestic brokerage expects BHEL to secure a combined order inflows of Rs 1.9 lakh crore over the next two years, led by both industry (non-power) and power segments. Supported by strong ordering, improving execution, and benefits of operating leverage, BHEL’s earnings are anticipated to climb up multi-fold over FY26-28. 

"With limited competition in the power equipment manufacturing space, BHEL stands to meaningfully benefit from the incremental opportunity. With an all-time high book to bill ratio of 7 times, the focus will now shift to smoothly executing these large projects promptly, which should drive strong earnings over FY26-28E," Antique said.