BHEL OFS opens for retail investors: Should you apply? Check technicals, targets & more

BHEL OFS: The offer-for-sale (OFS) of Bharat Heavy Electricals Ltd (BHEL) opens for subscription for retail investors today, that is, on Thursday, February 12. The issue, which had opened on Wednesday, February 11, was overall subscribed 2.35 times by institutional investors, who made bids for 22 crore equity shares.

The government of India had launched an OFS to divest up to a 5 per cent stake in the state-run capital goods major. Under the OFS, the Centre will initially sell a 3 per cent stake or 10.44 crore equity shares, with an option to offload an additional 2 per cent, or 6.96 crore equity shares, in case of oversubscription.

The floor price has been fixed at Rs 254 per share. The offer opened for non-retail investors on Wednesday. The shares were subscribed at a price of Rs 260.8 apiece, compared to the floor price of Rs 254 per share. Shares of BHEL settled at Rs 260.65 on Wednesday, falling 5.6 per cent for the day, with its total market capitalization close to Rs 91,000 crore.

India’s aggressive coal capacity targets – reaching 340 GW by 2047 – necessitate 170-180 GW of new projects beyond the existing pipeline (97GW). Brokerage firms are mostly positive on the issue and suggest to subscribe to it. Their price targets suggest up to 40 per cent upside in the stock.

BHEL, with a robust Rs 2.23 lakh crore order book (35 GW), is at an inflection point for accelerated execution. Margin is set to inflect as the execution mix shifts away from 8 GW of legacy, low-margin pre-Talcher projects toward higher margin new orders. BHEL is poised for scalable emerging areas – coal gasification and nuclear energy in addition to its presence in 765 kV and HVDC transmission, transportation and defence, said JM Finance.

“BHEL is trading at 23 times FY28 EPS, while the OFS is at a floor price of Rs 254, 21 times FY28 EPS. We estimate revenue/ Ebitda/ PAT to grow at a CAGR of 20 per cent/ 62 per cent/ 98 per cent during FY25–FY28E, as execution accelerates and Ebitda margins expand to 10.7 per cent in FY28E. We maintain a ‘buy’ with a target price of Rs 355, valuing at 30 times FY28E earnings,” it said.

Perumal Raja KJ, Associate Director of Research at FundsIndia also seconds this view and has suggested investors to apply for the OFS with a medium- to long-term investment horizon on the back of robust order book, execution progress across major projects and strong quarterly recovery.

“A sustained conversion of the existing order backlog is expected to remain the primary driver of revenue growth and margin expansion. Given the improving operational momentum, strong order visibility, and recovery in earnings trajectory, we believe the current OFS offers an opportunity for investors to gain exposure to BHEL’s turnaround story at a critical inflection point,” he said.

According to the shareholding pattern of the company as of December 31, 2025, the Government of India owned 63.17 per cent stake in BHEL, while more than 17.55 lakh retail investors owned over 32.05 crore equity shares or 9.21 per cent stake in the company. Retail investors are usually classified as those whose authorised share capital is up to Rs 2 lakh in a company.

On the other hand, Amit Anwani, Research Analyst, PL Capital said that BHEL has built a huge order book but execution process will be critical. Any delay in the execution will dent their EPS estimates. He believes that the floor price of OFS is the fair price for the stock, which does not leave much room for the investors.

PL Capital had revised its FY26E/FY27E EPS estimate by -18.9 per cent/-4.3 per cent factoring in slower execution pace amid strong order backlog, normalized provision, and moderate order inflow momentum post Q3 results. It trimmed its target price to Rs 245 from Rs 250 earlier, maintaining a hold rating on the stock.

BHEL’s net profit rose to Rs 390 crore, attributed to a strong increase in other income. PSU company’s Revenue for the quarter grew by 16.4 per cent YoY to Rs 8,473 crore, while other income more than doubled to Rs 219 crore. BHEL’s ebitda increased by 79 per cent YoY to Rs 546 crore, with margins expanding to 6.4 per cent for the reported quarter.
 

Other Target Prices

Antique Stock Broking has a ‘buy’ rating on BHEL, giving it a target price of Rs 349 apeice. ICICI Securities also remains positive on the stock, giving it a ‘buy’ with a target price of Rs 370, suggesting a 42 per cent upside in the stock from today’s lows. However, Kotak Institutional Equities has maintained a ‘sell’ rating on BHEL with a target price of Rs 120.
 

Technical Views

Following a sharp ascent from Rs 241 to Rs 277, BHEL is now witnessing profit booking, with a gap-down opening and a bearish candle below its 20 and 100 SMAs, indicating a potential correction or deceleration in its upward trajectory, said Laxmikant Shukla, Institutional Technical Analyst at YES Securities.

“The stock could find support near Rs 252 around its 200 SMA and a fall below this level may trigger further decline towards Rs 240. The bearish sentiment is expected to persist as long as the stock trades below the Rs 275–277 resistance zone,” he said.