Stories
BHEL Poised for Major Q2 Earnings Surprise While L&T Expected to Shine
- •IIFL Institutional Equities expert Renu Baid expects BHEL to deliver the biggest Q2 earnings surprise in the capital goods sector.
- •BHEL is projected to report over 25 percent sales growth, operating margins above 10 percent, and nearly doubled profits year-on-year.
- •Larsen and Toubro is expected to post 15 percent revenue growth and a 34 percent rise in EBITDA, driven by stable margins.
- •CG Power and MTAR Technologies are also anticipated to report steady performance and strong results among mid-cap stocks.
- •Strong order books and improving execution are expected to drive earnings growth across the capital goods sector despite slower domestic ordering.
Key Questions Answered
IIFL Institutional Equities expects BHEL to deliver the biggest Q2 earnings surprise in the capital goods sector, emerging from a prolonged execution slowdown. Renu Baid projects BHEL's sales to grow over 25%, operating margins to touch 10% or more, and net profit to nearly double year-on-year, supported by a robust order backlog of 6.9 times trailing 12-month sales.
For Larsen & Toubro, IIFL expects the core business to generate around 15% revenue growth. Additionally, EBITDA is projected to rise by 34% year-on-year, supported by stable operating margins of approximately 7.2%.
Aside from BHEL and L&T, IIFL highlights CG Power and MTAR Technologies as key beneficiaries of the ongoing investment cycle. CG Power is expected to post a steady quarter with about 20% revenue growth and 23% earnings growth, while MTAR Technologies is anticipated to post strong results among small and mid-cap names.
