Stock Review: BHEL

BHEL has been trailing the Sensex for over a year now but its robust order book and strong financials (as reflected in the flash results) make it a good buy at current levels.

   Its outstanding order book, at the end of FY 11, was 1,64,130 crore, which is nearly four times its provisional FY 11 turnover. This gives it a reasonable revenue visibility over the next few years.

   In the light of growing competition from Chinese suppliers and easier Chinese financing options, cash rich BHEL has been contemplating the launch of its own Non-Banking Finance Corporation (NBFC).

   The NBFC will not only earn better returns on the current cash balance but will also help the company's equipment sales division.