Project report on BHEL


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Project report on BHEL

  1. 1. 1 A PROJECT REPORT ON BHARAT HEAVY ELECTRONICS LIMITED Under the guidance of: Professor Kiran Mehta Submitted by : Shivi Sharma Cun120550078
  2. 2. 2 ACKNOWLEDGEMENT I would like to express my gratitude for the people who were part of this Project Report, directly or indirectly people who gave unending support right from the stage the idea was conceived. In particular I would like to thank Mr. Naveen Sharma, Sr. Superintendent in B.E.L, who gave me some information about BHEL. I would like to extend my heartiest thanks to Kiran maam providing me with the necessary resources and guidance for the paper without which we may not have been able to undertake the survey.
  3. 3. 3 TABLE OF CONTENTS PART-I 1. Industry Profile  Heavy electrical industry 2. Company relative position in that industry 3. BHEL  Company overview  Achievements  Listing information  Initiatives taken by BHEL  SWOT analysis  Outlook PART-II 1. Analysis and interpretation of various financial parameters 2. Graphs 3. Capital structure of company for last years 4. Dividend of company for last 5 years 5. BHEL at glance 6. Comparative study of the Bajaj steel industry ltd company of the same industry 7. Competitors of BHEL 8. Balance sheet of BHEL 9. Key Ratios 10.News relevant to the company 11.Bibliography
  4. 4. 4 Part I Industry Profile
  5. 5. 5 Heavy Electrical Industry A brief description:- Heavy industry sector is one of the core sectors of Indian economy. Therefore, it‟s fund requirements are inverse keeping in view the scale and size of the industrial units in the sector, the financial requirements are also huge. The heavy engineering sector is driving primarily by technology. This, coupled with the fact that the initial investment required for heavy engineering or capital goods manufacturing facilities is relatively high, creates relatively high entry barriers. Any business enterprises viability eventually boils down to cost – return trade off. Cost of funds is undoubtly, the most important determined of the viability. This becomes more crucial in heavy engineering sectors The development of the Indian heavy electrical machinery industry is directly linked to the Performance of the Power sector in India. With India‟s development, the need for more and Better Power supply has become essential for industries to grow. Thus with increasing focus on capacity expansion in the Power sector, the heavy electrical machinery manufacturing industry is expanding vigorously. BACKGROUND:- Heavy Electrical Industry covers power generation, transmission and distribution and utilization equipments. These include turbo generators, boilers, various types of turbines, transformers, switchgears and other allied items. Majority of the products manufactured by heavy electrical industry in the country, which includes items like transformers, switchgears etc. are used by all sectors of the Indian economy. Some major areas where these are used are the multi core projects for power generation including nuclear power stations, petrochemical complexes, chemical plants, integrated steel plants, non-ferrous metal units, etc.
  6. 6. 6 HISTORY:- India is the only other developing country besides China, which produces a full range of electric power generation and transmission equipment. In fact, the history and growth of (Bharat Heavy Electricals Ltd.), a public sector enterprise under in the country, symbolizes the overall growth pattern of heavy electrical industry in the country.BHEL has the unique distinction of being one of the very few companies in the world, manufacturing all major power generating equipment under one roof .The industry has been upgrading the existing technology and is now capable of taking up turnkey contracts also for export markets. The industry has been deli censed. Foreign collaborations are allowed with 100 percent FDI.The country is planning to add 150,000 MW power generation capacities in the next 10 years. This will generate substantial demand for heavy electrical equipments. The heavy electrical industry is capable of manufacturing transmission and distribution equipment up to 400 KV AC and high voltage DC. The industry has taken up the work of up gradation and transmission to the next higher voltage system of 765 KV and have upgraded their manufacturing facilities to supply 765 KV class transformers, reactors, CTS, CVT, bushing and insulators, etc. BHEL systems for power plants, defence and other applications. The company has commenced manufacture of large scale desalination plants to help augment the supply of drinking water Company background 1956 - Company was set up at Bhopal in the name of M/s Heavy electrical (India) Ltd. in collaboration with AEI, UK. Subsequently, three more plants were set up at Hyderabad, Hardwar and Trichy. The Bhopal Unit was controlled by the company, the other three were under the control of Bharat Heavy Electricals Ltd. - The Company`s object is to manufacture of heavy electrical equipments. 1972 - In July the Operations of all the four plants were integrated. 1974 - In January Heavy electrical (India) Ltd was merged with BHEL. - For the manufacture of a wide variety of products, the company has developed technological infrastructure, skills and quality to meet the stringent requirements of the power plants, transportation, petro chemicals, and oil etc. - BHEL has entered into collaboration which are technical in nature. Under these agreements, the collaborators have transferred, furnished the information, documentation, including know-how relating to design, engineering, manufacturing assembly etc. 1982 - BHEL also entered into power equipments, to reduce its dependence on the power sector.
  7. 7. 7 BHEL has 1. Installed equipment for over 90000MW of power generation-for utilities, captive and industrial users. 2. Supplied over 225000MW a transformer capacity and other equipment operating in transmission and distribution network up to 400Kv (AC& DC) 3. Supplied over 25000 motors with drive control system to power projects, petro chemicals, refineries, steel, aluminium, fertilizers, cement plants etc. 4. Supplied traction electrics and AC/DC locos to power over 12000kms railway network. 5. Supplied over one million valves to power plants and other industries. BHEL caters to core sectors of the Indian economy viz; power generation & transmission, industry, transportation, telecommunication, renewable energy, defence etc. the wide network of BHEL‟s 14 manufacturing divisions, four power sector regional centres, over 100 project sites, eight service centres and 14 regional offices enables the company to be closer to its customers and provide them with suitable products, systems and services efficiently and at competitive prices. Having attained ISO 9000 certification, BHEL is now well on its journey towards total quality management (tqm). On the environmental management front, the major units of bhel have4 already acquired the ISO 14001 certification, Power sector Power generation sector comprises thermal, gas, hydro and nuclear power plant business. As of 31-3-2004, BHEL supplied sets account for nearly 71,255 MW or 64% of the total installed capacity of 1, 11,151 MW in the country, as against nil till 1969-70. BHEL has proven turnkey capabilities for executing power projects from concepts to commissioning. It possesses the technology and capability to produce thermal sets with super critical parameters up to 1000 mw unit rating and gas turbine-generator sets of up to 250 mw unit rating. Cogeneration and combined-cycle plants have been introduced to achieve higher plant efficiencies. To make efficient use of the high ash-content coal available in India, BHEL supplies circulating fluidized bed combustion boilers to both thermal and combined- cycle power plants. The company manufactures 235 MW nuclear turbine generator sets and has commenced production of 500 MW nuclear turbine generator sets. Custom-made hydro sets of Francis, Pelt on And Kaplan types for different head discharge combinations are also engineered and manufactured by BHEL. In all, orders for more than 700 utility sets of thermal, hydro, gas and nuclear have been placed on the company as on date. The power plant equipment manufactured by BHEL is based on contemporary technology comparable to the best in the world, and is also internationally competitive. The company has proven expertise plant performance improvement through renovation, modernization and upgrading of a variety of power plant equipment, besides specialized know how of residual life assessment, health diagnostics and life extension of plants.
  8. 8. 8 Transmission BHEL also supplies a wide range of transmission products and systems of upto 400KV class. These include high voltage power & instrument transformers, dry type transformers, shunt & series reactors, sf switch gear, 33KV gas insulated subn station capacitors, insulators etc. for economic transmission of bulk power over long distances, High Voltage Direct Current (HVDC) systems are supplied. Series and shunt compensation systems, to minimize transmission loses, have also been supplied. Industry sector Industries BHEL is a major contributor of equipment and systems to industries: cement, sugar, fertilizer, refineries, petrochemicals, steel, paper etc. the range of systems and equipment supplied includes: captive power plants, dg power plants, high speed industrial drive turbines, industrial boilers and auxiliaries, waste heat recovery boilers, gas turbines, heat exchangers and pressure vessels, centrifugal compressors, electrical machines, pumps, valves, seamless steel tubes and process controls, control systems for process industries, and control and instrumentation to people. Transportation Mosty of the trains operated by the Indian railways, including the metro in Calcutta, are equipped with BHEL‟s traction electrics and traction control equipment. The company supplies electric locomotives to Indian Railways and diesel shunting locomotives to various industries. 5000/4600 hp ac/dc locomotives developed and manufactured by BHEL have been supplied to Indian railways. Battery powered road vehicles are also manufactured by the company. BHEL also supplies traction electrics and traction control equipment for electric locos, diesel electric locos, and EMUs/ DEMUs to the railways. Telecommunication Bhel also caters to telecommunication sector by way of small, medium, and large switching systems. Renewable energy Technologies that can be offered by BHEL for exploiting non-conventional and renewable resources of energy include: wind electric generators, solar power based water pumps, lighting and heating systems. The company manufactures wind electric generators of unit size up to 250 KW for wind farms, to meet the growing demand for harnessing wind energy.
  9. 9. 9 International operations BHEL has, over the years established its references in over 50 countries of the world, ranging from the United States in the west to new-Zealand in the far east. These references encompass almost the entire product range of BHEL, covering turnkey power projects of thermal, hydro and gas based type sub-station projects, rehabilitation projects, besides a wide variety of products, like switch gear, transformer, heat exchangers,insulators,castings and forgings. Apart from over 1100MW of boiler capacity contributed in Malaysia, some of the other major successes achieved by the company have been in Oman, Saudi Arabia, Libya,Greece,Cyprus,Malta,Egypt,Bangladesh,Azerbaijan,Sri lanka,Iraq etc. execution of overseas projectys has also provided BHEL the experience of working with world renowned consulting organizations and inspection agencies. Technology Up gradation and research and development To remain competitive and meet customers‟ expectations, BHEL lays great emphasis on the continuous up gradation of products and related technologies, and development of new products. The company has upgraded its products to contemporary levels through continuous in-house efforts as well as through acquisitions of new technologies from leading engineering organizations of the world. The corporate R&D division at Hyderabad leads BHEL‟s research efforts in a number of areas of importance to BHEL‟s product range. Research and product development centres at each of the manufacturing divisions play a complementary role. The investments in R & D by the electrical industry are amongst the largest in the corporate sector in India. Large electrical equipment used in steel plants, petrochemical complexes and other such heavy industries are also being manufactured in the country. The domestic heavy electrical equipment manufacturers are making use of the developments of the global market with respect to product designs and upgrading of manufacturing and testing facilities. The heavy electrical industry has established its reference in the global arena also. These encompass thermal, hydro and gas based power plants, substation projects, rehabilitation projects, besides a wide variety of products like transformers, photo voltaic equipments, insulators, switchgears, motors, etc
  10. 10. 10 .COMPANY’S RELATIVE POSITION IN THAT INDUSTRY:- It is an integrated power plant equipment manufacturer and one of the oldest and largest engineering and manufacturing enterprise of India. It is world‟s 12th largest power equipment manufacturer. It is India‟s ninth largest public sector undertaking. BHEL is one of the few companies of the world who have the capability to manufacture entire range of power plant equipment. Forbes business magazine of the year 2011 ranked BHEL as the ninth most innovative company of the world. BHEL is the only Indian engineering company to be listed. 2010 edition of Forbes Asia‟s fabulous list placed BHEL at 4th place. BHEL has been continuously earning profit since 1971-72.
  11. 11. 11 Bharat Heavy Electricals Limited (BHEL) Company overview:- Bharat Heavy Electricals (BHEL or the company) is an India-based engineering and manufacturing company that develops electrical and power equipment in energy related and infrastructure sector. It manufactures over 180 products under 30 major product groups and caters to sectors including power generation and transmission, transportation, and renewable energy, among others. The company operates in India and exports its products to several countries. BHEL is headquartered in New Delhi, India and employs about 46,748 people. The company recorded revenues of INR418, 546.6 million ($9,178.7 million) during the financial year ended March 2011 (FY2011), an increase of 26.2% over FY2010. The operating profit of the company was INR72, 109 million ($1,581.4 million) during FY2011, an increase of 76.3% over FY2010. The net profit was INR60,533.6 million ($1,327.5 million) in FY2011, an increase of 39.9% over FY2010.Note: The operating profit has been calculated after deducting the following items from net turnover as mentioned in the company's "Consolidated Profit and Loss Account" for FY2011: consumption of material, erection, and engineering expenses; other expenses of manufacture; employees' remuneration and benefits; administration, selling, and distribution provisions (net); and depreciation and amortization.
  12. 12. 12 Organization Structure of BHEL:- BHEL is spread out over various parts of the country from Haridwar in North to Tiruchi in South. Centralized policy making and decentralized administration Unit managers have complete authority and power Always has been reviewing its organizational structure to ensure customer needs are fulfilled and internal synergy is maximized BHEL is commercial organization. The Powers of company officials are well defined at all levels in the organization. The duties are assigned from time to time. BHEL- Achievements:- Attained ISO - 9001 certification. BHEL have been upgraded to the latest ISO-9001: 2000 version BHEL has been awarded ISO -14001 certification for environmental management systems and OHSAS-18001certification for occupational Health and safety management systems. First Public Sector Company in the country to win the coveted „PRIZE‟throughits HaridwarunitundertheCIIEximAward Scheme based on globally recognized model of European Foundation for Quality Management BHEL's R&D ops contribute Rs 1,151 cr to turnover in 2005-06 [May 19 2006]NEW DELHI: Bharat Heavy Electricals Ltd on May 18 said the company has achieved a turnover of Rs 1,151 crores during 2005-06 through products developed by in-house research and development operations. This revenue was eight per cent of its total revenue of Rs 14,410 crores in 2005-06. This was the result of a constant thrust on developing new technologies and products, improving existing products and systems in terms of reliability, cost and quality through in-house R&D efforts. The company invested about Rs 150 crores on Research and Development of products and systems during the year, which was among the highest in the country. The company also filed for 84 patents, including three abroad, taking the total number of patents filed till date to 339. Out of this, BHEL has been granted 26 patents and the rest are in various stages of processing. Thirteen copyrights have also been filed. R&D and technology development are of strategic importance to BHEL as it operates in a competitive environment where technology is a major factor. BHEL to manufacture 800 mw thermal sets [Apr 14 2006]Catching up with the advancement in global technologies, Bharat Heavy Electricals Ltd (BHEL), through the efforts of its corporate research and development division in Hyderabad, is now
  13. 13. 13 equipped to manufacture 800 mw super-critical thermal power sets in the country. Much sought-after by several players in power generation, including APGenco, for its fuel efficiency, the super-critical technology has been till now viewed as the sole domain of developed world. As part of its effort to emerge as one of the global technology players in power systems and other new technologies, the R&D division of BHEL has started fresh initiatives by setting up centres of excellence for surface engineering (Coe-SE) and intelligent machines and robotics (CIMAR). According to the source, CIMAR would be set up at the Corporate R&D division in Hyderabad at an initial investment of Rs 4.77 crores. Among the new products, the BHEL Corporate R&D has successfully completed design, supply and commissioning of automated storage and retrieval systems for four of the 13 warehouses at the Central Ordnance Depot, Kanpur. 1. BHEL inks agreement with IIT Madras for new courses [Apr 25 2006] Chennai: Bharat Heavy Electricals Ltd and the Indian Institute of Technology-Madras have signed a memorandum of understanding for collaborative research in the areas of design of boilers, manufacturing, metallurgical engineering, mechanical engineering, information technology and other areas of mutual interest. With the help of BHEL, Tiruchi, IIT-M will establish a research centre at the BHEL campus for the purpose. IIT-M will select MS/PhD research scholars to work as research associates/project associates. BHEL on its part will make available its research facilities and laboratories for the purpose. The collaboration has also given scope for IIT-M to start two new courses one on energy engineering and another on welding engineering. The courses will start from the academic year 2006-07. BHEL, which designs power plant boilers for handling a variety of coals, is also interested in getting into coal research. 2. BHEL secures Rs 80 cr export order from EETC [May 10 2006]NEW DELHI: Bharat Heavy Electricals Ltd (BHEL) has bagged its largest ever export order for transformers worth Rs 80 crores from Egyptian Electricity Transmission Co (EETC). BHEL will supply 14 transformers of 125 MVA to the state-run Egyptian company as a part of the order. These transformers would be installed in eight sub-stations at different locations in Egypt. The transformers, to be built at the company's Jhansi plant, would be installed and commissioned under BHEL supervision. The company had earlier executed a boiler project at Al Arish in Egypt. With the order for transformers, BHEL has also established itself in the transmission market in Egypt. BHEL had earlier reported a six-fold increase in its export orders booking for the fiscal ended March 31 at Rs 3,348 crores. These orders contributed to one-fifth of the company's total orders booked last year. With this BHEL is poised to achieve a quantum growth in its export business driven by consolidation in existing markets and widening its export base through expansion of existing basket of products and services and entering new markets. 3. BHEL net profit up 62 pc(the tribune,3 june 2006)BHEL has posted a net profit of Rs 867.95 crores for the quarter ended March 31,2006, as compared to Rs 534.28 crores for the quarter ended March 31, 2005, an increase of 62.45 pc. Total income
  14. 14. 14 has increased from Rs 4,518.94 crores in Q4 FY 04-05 to Rs 5728.96 crores for Q4 FY 05-06.It has posted a net profit of Rs 1679.16 crores for the year ended March 31, 2006(FY 05-06) as compared to Rs 953.40 crores for the urea ended March 31, 2005. Total income has increased from Rs 9977.36 crores in FY 04-05 to Rs 13820.02 crores for FY 05-06.The board of directors has recommended a final dividend of 20 percent of equity of the company, making it to total of 145 percent of the equity share capital of the company for the financial year 2005-06. This includes the interim dividend of 40 percent and special dividend of 85 percent already paid during the year. Workers’ participation in management yields savings at BHEL, Hardwar DEHRA DUN, Nov 16: Empowerment of employees through the "quality the areas of import substitution, revamping of old machine tools and safety over the past two decades based on the principle of people-building and mutual development, the "quality circle" was adopted by the BHEL‟s Hardwar Plant in the year 1981 and has, since then, yielded savings of nearly Rs five crores, according to Mr Ashbin Dear, Public Relations Officer of the organisation. The quality circle guides the combined efforts and knowledge of workmen of a particular section. There are more than four hundred quality circles actively working to enhance the excellence on the process, quality and delivery fronts, Mr Dear said. Coordinators and facilitators along with other members of the workers‟ groups identify problems and think of solutions collectively to prevent defects and maintain overall quality. Mr Dear said upgrading, renovation and modernisation of hydro sets installed at various power stations equipped with BHEL and non-BHEL equipment was being now undertaken by the Hardwar unit through its research and development efforts. The Hardwar unit of BHEL has received an order of Rs eight crores from Power Development Corporation, Jammu and Kashmir, to carry out renovation and modernisation of the lower Jhelum Hydro Electric Project. This project is equipped with turbine and operator equipment supplied by BHEL and the project was commissioned in 1980. Another order, worth Rs thirty crores, was received by the BHEL plant for renovation, modernisatup rating prating of the units of Ganguwal and Kotla Hydro Electric Projects under Bhakra Beas Management Board and will ensure an increased output of the generating units by as much as twenty per cent. Earlier, one unit each of the above machines was renovated and up rated by the BHEL resulting in a similar output increase for these machines. More than a hundred sets of different capacities supplied by BHEL, Hardwar, are commissioned at various power stations all over the country. The hydro sets are tailor-made to suit varying hydro electric parameters
  15. 15. 15 Listing Information:- Face Value 2.0 Market Lot of Equity Shares 1 BSE Code 500103 BSE Group A
  16. 16. 16 BHEL has put in place a number of initiatives, as follows, . 1. Strengthening company‟s core businesses of Power Generation, Transmission & Distribution, Transportation and Industrial Systems & Products, through accelerated project completion and consequent benefits to customers, along with new initiatives in marketing, technology, facility up-gradation and modernisation, enhancing operational effectiveness etc. i. . 2. Business Development efforts in related and allied areas utilising the organisational strengths and forming customer focused specialised business groups e.g. formation of Oil Sector R&M Business Group to address business in Renovation and Modernisation of off-shore and on-shore oil platforms, downstream petroleum refining areas and Power Plant Operational Services Group to provide Operations and Maintenance (O&M) , Services for Power Plants. 3. After Market Services being the areas for future growth, spares and R&M services business have been integrated into one focused group. R&M for hydro sets is an area having major growth opportunity which BHEL is poised to tap. 4. Exploring Business opportunities in areas like Energy Conservation, Water Management, Pollution Control and Waste Management, Ports, LNG terminals etc. 5. Positioning for Information technology Business leveraging the domain knowledge in Power Sector& Engineering field to provide IT enabled services for Power Sector and software services for Engineering Industry. 6. Sustain and Enhance Exports for products and services through multi-pronged approaches like entering new territories, focus on product sales, entry into IPP segment, offering O&M and LTSA, EPC, becoming a service centre for international Original Equipment Manufacturers (OEMs) and setting up of manufacturing assembly and repair enters in the regions of demand etc. BHEL is also taking steps to re-position it to meet the demands of the new market economy through suitable strategies keeping in view the ultimate objective of enhancing value for its stakeholders.
  17. 17. 17 Swot analysis of bhel:- STRENGTH Robust research and development activity Leading market positions WEAKNESS Safety issues Non autonomy OPPORTUNITIES Expanding manufacturing capacity Strong order intake THREATS International laws and regulations Increasing price of raw material
  18. 18. 18 OPPORTUNITIES AND THREATS Government of India has embarked upon an ambitious programme of doubling the generation capacity to ensure “Power on demand by 2012”. This would necessitate huge mobilisation of resources to the tune of Rs.80,00,000 million including Transmission and Distribution (T&D) sector which has been identified as a high priority area. Due to inadequate investments in Transmission Sector so far, power evacuation from generating stations remains a major bottleneck. Accordingly, a perspective plan to build 30,000 MW inter-regional transmission network and formation of national grid are being drawn up. Distribution is another area which is being reformed to improve the financial health of the State Electricity Boards (SEBs) through various initiatives like privatisation/ Corporatisation. In order to bring about improvements in the functioning of the SEBs,Government has taken a number of initiatives including securitisation of outstanding dues of SEBs.This development will improve the credit rating of SEBs enabling raising of funds for investments. Government has been developing strategies to improve the hydro-thermal mix and substantially step up the contribution of this clean and stably priced source of energy through higher budgetary allocation and speedier clearance process. BHEL, being a major equipment supplier, is likely to reap benefits from this initiative. Government is also taking steps to promote captive power capacity which is estimated to be about 20,000 MW. A comprehensive Captive power generation policy for purchase and wheeling of surplus power is being evolved, which is likely to boost investment in this area. BHEL being a major player in this business segment stands to gain. Coal as a fuel will continue to dominate powergeneration in our country, more so for the reason of energy security. To reduce the cost of power, pit-head and coastal plants are planned to be set up to avoid high cost of transportation of coal and relieve the already stretched rail network. In addition to this, from the point of view of greater thermal efficiency and environmental considerations, Gas/ LNG based power plants will continue to be the preferred choice of power plant builders in the medium term. During the year gone by, industries, to which BHELsupplies the capital goods, experienced a slow rate of growth as well as stagnation in investment activity in the country. Also, the prospects of investment activity picking up during the current year seem difficult. Index of Industrial Production (IIP) is projected to grow by a higher rate of 3.5% in 2002-03 compared to 2.7% in 2001-02, a positive signal for impending industrial recovery. Among the sectors, Cement and Transportation are poised for healthy growth in 2002-03. For optimal development of electrical energy in its totality, an integrated approach, including capacity addition through Non-conventional sources has been adopted by the Government. Accordingly, a target of 10700 MW through non-conventional sources has been fixed for the period up to 2012. Distributed Generation (DG) and Combined Heat and Power (CHP) are emerging growth opportunities in the near future. In addition to conventional DG technologies, Biomass, Photo-voltaic, Wind turbines, Micro turbines and Fuel Cells are progressing at rapid pace and promise to change the economic equation of this large and important market.
  19. 19. 19 In order to accelerate rural electrification, it has been proposed to treat rural electrification as a basic minimum service in the Prime Minister‟s Gramodaya Yojna. Rural electrification plan for electrification of 62000 villages by 2007 and 18000 remote villages (through renewable) by 2012 is being proposed. OUTLOOK While the Indian Economy is continuing to grow at slow pace, there are positive impulses like on-going Restructuring and initiative. Reforms in the Power Sector, enhanced focus on Distribution, vie increased outlay for Accelerated Power Development and Reforms Programme (APDRP), creating regulatory system, new Electricity Bill etc. Government‟s commitment to enhance private and public investments in the infrastructure is a positive aspect that will spur Industrial Growth and enhance market prospects for industrial products in the coming years.
  20. 20. 20 Part II- Analysis and Interpretation of Various Financial Parameters
  21. 21. 21 CALCULATION OF:- Change in Share Price of the Company in last five years ( On the basis of Monthly Observations for long term and medium term analysis and on the basis of daily observations for a short term analysis) the Beta Value of the company for a period of last 5 years considering daily observations and interpret it. Sub-divide the analysis on the basis of Long Term, Medium Term and Short Term Analysis. the Risk involved in stock price movement through Standard Deviation and coefficient of variation for long term medium term and short term duration
  22. 22. 22 GRAPHS
  23. 23. 23 Data of daily basis 0 500 1000 1500 2000 2500 3000 01/Jan/08 01/Jan/09 01/Jan/10 01/Jan/11 01/Jan/12 CLOSE PRICE CLOSE PRICE
  24. 24. 24 0 5000 10000 15000 20000 25000 CLOSE of sensex CLOSE of sensex
  25. 25. 25 -0.5 0 0.5 1 1.5 2 01/Jan/08 01/Jan/09 01/Jan/10 01/Jan/11 01/Jan/12 Return on price Return on price
  26. 26. 26 -0.2 -0.15 -0.1 -0.05 0 0.05 0.1 0.15 01/Jan/08 01/Jan/09 01/Jan/10 01/Jan/11 01/Jan/12 Return on sensex Return on sensex
  27. 27. 27 On monthly basis 0 500 1000 1500 2000 2500 3000 Jan/08 Jun/08 Nov/08 Apr/09 Sep/09 Feb/10 Jul/10 Dec/10 May/11 Oct/11 Mar/12 Aug/12 Jan/13 CLOSE PRICE CLOSE PRICE
  28. 28. 28 0 5000 10000 15000 20000 25000 Jan/08 May/08 Sep/08 Jan/09 May/09 Sep/09 Jan/10 May/10 Sep/10 Jan/11 May/11 Sep/11 Jan/12 May/12 Sep/12 Jan/13 CLOSE CLOSE
  29. 29. 29 -0.5 0 0.5 1 1.5 2 Jan/08 Jun/08 Nov/08 Apr/09 Sep/09 Feb/10 Jul/10 Dec/10 May/11 Oct/11 Mar/12 Aug/12 Jan/13 Return on price Return on price
  30. 30. 30 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 Jan/08 Jun/08 Nov/08 Apr/09 Sep/09 Feb/10 Jul/10 Dec/10 May/11 Oct/11 Mar/12 Aug/12 Jan/13 Return on sensex Return on sensex
  31. 31. 31 Yearly basis:- 0 500 1000 1500 2000 2500 3000 CLOSE PRICE Series1 Series2 Series3 Series4 Series5 Series6
  32. 32. 32 0 5000 10000 15000 20000 25000 CLOSE Series1 Series2 Series3 Series4 Series5 Series6
  33. 33. 33 -1 -0.5 0 0.5 1 1.5 2 2.5 Return on price Series1 Series2 Series3 Series4 Series5 Series6
  34. 34. 34 -0.7 -0.6 -0.5 -0.4 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 0.4 Return on sensex Series1 Series2 Series3 Series4 Series5 Series6
  35. 35. 35 Capital structure of the company for last five years (Rs crores) From Year To Year Class Of Share Authorized Capital Issued Capital Paid Up Shares (No’s) Paid Up Face Value Paid Up Capital 2011 2012 Equity Share 2,000.00 489.52 2447600000 2 489.52 2010 2011 Equity Share 2,000.00 489.52 489520000 10 489.52 2009 2010 Equity Share 2,000.00 489.52 489520000 10 489.52 2008 2009 Equity Share 2,000.00 489.52 489520000 10 489.52 2007 2008 Equity Share 2,000.00 489.52 489520000 10 489.52
  36. 36. 36 Dividend of the company for last five years Year Month Dividend (%) 2013 Jan 106 2012 May 184 2012 Feb 136 2011 May 179 2011 Mar 133 2010 May 123 2010 Jan 110 2009 May 80 2009 Jan 90 2008 May 63 2008 Jan 90 2007 May 60 2007 Jan 125
  37. 37. 37 BHEL AT A GLANCE: - Turnover [Rs. In Crores]:- Profit Before Tax [Rs. In Crores] 0 200 400 600 800 1000 1200 Series1 0 200 400 600 800 1000 1200 Series1
  38. 38. 38 Net Profit [Rs. In Crores] R&D Investment [Rs. In crores] 0 200 400 600 800 1000 1200 Series1 0 200 400 600 800 1000 1200 Series1
  39. 39. 39 Record Performance under difficult market conditions:-  Financial –highest turnover and profit  XI plan capacity addition – nearly double of that achieved in X plan period.  Increased focus on Engineering and R&D- highest R&D expenditure and highest patents / copyrights field. 2010-2011 2010-2011 2011-2012 (Provisional) % change Turnover 43337 41299 49301 increase 19.4 Profit before tax 9006 8487 10001 increase 17.8 Net Profit 6011 5665 6868 increase 21.2 Net worth 20154 19808 24947 increase 25.9 Earnings Per Share 24.56 23.15 28.06 increase 21.2 R&D Investment 982 982 1162 increase 18.3
  40. 40. 40 Comparative study of the following company of the same industry: BAJAJ STEEL INDUSTRIES LIMITED, a professionally managed organization is engaged in offering a technically advanced solution to the cotton Ginning & Pressing Industry. Backed by well-furnished CNC Turning Centers from Taiwan, CNC Planomillers, Drilling & Assembly Centers, we have been designing high tech Cotton Processing Machine for higher as well as accurate production. Our more than 100 years of experience assists us in developing machines to gin and press cotton at lowest per unit cost at optimum capital investment. Using advanced manufacturing practices, we design ginning and pressing machines under Technical Collaboration from Central Institute for Research on Cotton Technology (CIRCOT ICAR), the Pioneer Technical Body of Government of India in respect to Cotton Ginning & Pressing Technology. Our machines give highest production at lowest cost with best fiber parameters and lowest electrical power consumption per unit of production in trouble free manner. Today, we have carved a niche as one of the key Decorticator Manufacturers and Auto Feeder Machine Suppliers based in India. Adhering to ethical business policies, we have become an approved supplier, under Technology Mission on Cotton & Technology up gradation fund for cotton ginning & pressing plant machinery by Ministry of Textiles, Government of India. On the grounds of our right wok ethics, we have spread the business regime to all over India, Bangladesh, Egypt, Kenya, Madagascar, Malaysia, Myanmar, Nigeria, Pakistan, Peru, South Africa, Tajikistan, Tanzania, Uganda, Zambia, Zimbabwe and many other countries. Last but not the least, we always endeavor to maintain a long lasting relationship of trust with the esteemed clients.
  41. 41. 41 The summary page of Bajaj Steel Industries Ltd. captures the information on its Live Stock Price and Volume, 52 Week High Low, Intraday and Historical Price Chart, Key Ratios, F&O Quotes, Competitors, Comparative Analysis, Buy Sell Recommendations, Company News and Announcements, Shareholding Pattern, Key Quarterly and Annual P&L A/c items, and Community Prediction Quarterly - Bajaj Steel Industries Ltd. Sep'12 Jun'12 Mar'12 Dec'11 Sep'11 INCOME: Net Sales Turnover 76.91 41.63 70.21 105.31 88.88 Other Income 0.62 0.55 0.88 0.46 0.55 Total Income 77.53 42.18 71.09 105.77 89.43 EXPENSES Stock Adjustments 6.34 -6.97 1.70 4.43 5.98 Raw Material Consumed 48.63 38.24 44.99 72.58 50.18 Power and Fuel 0.00 0.00 0.00 0.00 0.00 Employee Expenses 4.88 4.65 5.46 5.82 5.41 Administration and Selling Expenses 0.00 0.00 0.00 0.00 0.00 Research and Development Expenses 0.00 0.00 0.00 0.00 0.00 Expenses Capitalised 0.00 0.00 0.00 0.00 0.00 Other Expenses 9.94 7.29 14.59 11.16 21.87 Provisions Made 0.00 0.00 0.00 0.00 0.00 TOTAL EXPENSES 69.79 43.21 66.75 94.00 83.44 Operating Profit 7.12 -1.58 3.46 11.31 5.44 EBITDA 7.74 -1.03 4.35 11.77 5.99 Depreciation 1.26 1.26 1.44 1.39 1.39 EBIT 6.48 -2.29 2.90 10.38 4.60 Interest 1.66 1.73 1.69 1.68 1.87 EBT 4.82 -4.02 1.21 8.70 2.72 Taxes 0.26 0.00 0.40 2.81 0.59 Profit and Loss for the Year 4.56 -4.02 0.81 5.89 2.13 Extraordinary Items 0.00 0.00 0.00 0.00 0.00 Prior Year Adjustment 0.00 0.00 0.00 0.00 0.00 Other Adjustments 0.00 0.00 0.00 0.00 0.00 Reported PAT 4.56 -4.02 0.81 5.89 2.13 KEY ITEMS Reserves Written Back 0.00 0.00 0.00 0.00 0.00 Equity capital 2.35 2.35 2.35 2.35 2.35 Reserves and Surplus 0.00 0.00 0.00 0.00 0.00 Equity Dividend Rate 0.00 0.00 0.00 0.00 0.00 Agg. Non-Promoter Shares(lacks) 14.89 14.89 14.89 14.89 14.89 Agg. Non-Promoter Holding (%) 63.38 63.38 63.37 63.38 63.37 Government Share 0.00 0.00 0.00 0.00 0.00 Capital Adequacy Ratio 0.00 0.00 0.00 0.00 0.00 EPS (Rs.) 19.41 -17.09 3.45 25.06 9.08
  42. 42. 42 Yearly - Bajaj Steel Industries Ltd. Mar'12 Mar'11 Mar'10 Mar'09 Mar'08 INCOME: Net Sales Turnover 315.48 204.38 212.26 229.08 187.83 Other Income 2.29 1.58 2.27 5.49 1.65 Total Income 317.77 205.96 214.52 234.58 189.48 EXPENSES Stock Adjustments 13.52 -9.88 -12.90 6.71 -3.86 Raw Material Consumed 196.89 147.68 131.55 156.41 136.23 Power and Fuel 0.00 0.00 0.00 0.00 0.00 Employee Expenses 21.43 20.18 15.88 8.24 15.14 Administration and Selling Expenses 0.00 0.00 0.00 0.00 0.00 Research and Development Expenses 0.00 0.00 0.00 0.00 0.00 Expenses Capitalised 0.00 0.00 0.00 0.00 0.00 Other Expenses 61.67 33.96 53.99 31.18 24.23 Provisions Made 0.00 0.00 0.00 0.00 0.00 TOTAL EXPENSES 293.51 191.95 188.53 202.54 171.74 Operating Profit 21.97 12.43 23.73 26.55 16.09 EBITDA 24.26 14.01 26.00 32.04 17.74 Depreciation 5.61 5.48 5.14 4.37 2.54 EBIT 18.64 8.54 20.86 27.66 15.20 Interest 6.85 5.91 5.60 4.54 4.73 EBT 11.80 2.63 15.26 23.13 10.46 Taxes 3.80 0.92 5.01 7.31 3.40 Profit and Loss for the Year 8.00 1.71 10.24 15.82 7.06 Extraordinary Items 0.00 0.00 0.00 0.00 0.00 Prior Year Adjustment 0.00 0.00 0.00 0.00 0.00 Other Adjustments 0.00 0.00 0.00 0.00 0.00 Reported PAT 8.00 1.71 10.24 15.82 7.06 KEY ITEMS Reserves Written Back 0.00 0.00 0.00 0.00 0.00 Equity capital 2.35 2.35 2.20 2.20 2.20 Reserves and Surplus 0.00 441.19 44.12 0.00 0.00 Equity Dividend Rate 0.00 0.00 0.00 0.00 0.00 Agg. Non-Promoter Shares(lacks) 14.89 14.89 14.40 14.37 14.20 Agg. Non-Promoter Holding (%) 63.37 63.37 65.44 65.33 64.53 Government Share 0.00 0.00 0.00 0.00 0.00 Capital Adequacy Ratio 0.00 0.00 0.00 0.00 0.00 EPS (Rs.) 34.03 7.26 46.56 71.91 32.11
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  44. 44. 44 Competitors of BHEL In this kind of economy, it‟s no surprise that BHEL has competitions to keep the market in their hands. Their biggest competitor being Larsen and Turbo (L&T), though still a bit far away, in future they are a concern for BHEL, especially since they have greater turnover, profit and assets at present and only defeated in terms of market share. 73% of energy production is by BHEL manufactured equipments. Here‟s a list of all the competitors in the Indian market for energy sector with their particular details from Top News-
  45. 45. 45 Balance sheet - Bharat Heavy Electricals Ltd. Particulars Mar'12 Mar'11 Mar'10 Mar'09 Mar'08 Liabilities 12 Months 12 Months 12 Months 12 Months 12 Months Share Capital 489.52 489.52 489.52 489.52 489.52 Reserves & Surplus 24,883.69 19,664.32 15,427.84 12,449.29 10,284.69 Net Worth 25,373.21 20,153.84 15,917.36 12,938.81 10,774.21 Secured Loans 0.00 0.00 0.00 0.00 0.00 Unsecured Loans 123.43 163.35 127.75 149.37 95.18 TOTAL LIABILITIES 25,496.64 20,317.19 16,045.11 13,088.18 10,869.39 Assets Gross Block 9,729.62 8,049.30 6,579.70 5,224.43 4,443.03 (-) Acc. Depreciation 5,409.83 4,648.82 4,164.74 3,754.47 3,462.21 Net Block 4,319.79 3,400.48 2,414.96 1,469.96 980.82 Capital Work in Progress. 1,324.63 1,762.62 1,550.49 1,212.70 658.47 Investments. 461.67 439.17 79.84 52.34 8.29 Inventories 13,444.50 10,963.03 9,235.46 7,837.02 5,736.40 Sundry Debtors 26,336.13 27,354.62 20,688.75 15,975.50 11,974.87 Cash And Bank 6,671.98 9,630.15 9,790.08 10,314.67 8,386.02 Loans And Advances 14,217.32 13,267.07 4,801.24 4,616.67 7,366.17 Total Current Assets 60,669.93 61,214.87 44,515.53 38,743.86 33,463.46 Current Liabilities 33,638.01 31,469.58 28,097.73 23,415.10 16,632.97 Provisions 7,641.37 15,030.37 4,417.98 4,975.58 7,608.68 Total Current Liabilities 41,279.38 46,499.95 32,515.71 28,390.68 24,241.65 NET CURRENT ASSETS 19,390.55 14,714.92 11,999.82 10,353.18 9,221.81 Misc. Expenses 0.00 0.00 0.00 0.00 0.00 TOTAL ASSETS (A+B+C+D+E) 25,496.64 20,317.19 16,045.11 13,088.18 10,869.39
  46. 46. 46 Key Ratios Years Mar-12 Mar-11 Mar-10 Mar-09 Mar-08 Debt-Equity Ratio 0.0 0.0 0.0 0.0 0.0 Long Term Debt-Equity Ratio 0.0 0.0 0.0 0.0 0.0 Current Ratio 1.8 1.6 1.4 1.4 1.5 Fixed Assets 5.7 6.0 5.9 5.9 5.1 Inventory 4.1 4.4 4.0 4.2 4.4 Debtors 2.2 2.2 1.9 2.0 2.0 Interest Cover Ratio 201.9 165.5 197.7 158.9 126.1 PBIDTM (%) 22.2 21.8 20.5 18.3 21.9 PBITM (%) 20.6 20.6 19.1 17.1 20.6 PBDTM (%) 22.1 21.7 20.4 18.2 21.8 CPM (%) 15.6 14.9 13.8 12.2 14.5 APATM (%) 14.0 13.7 12.5 11.0 13.2 ROCE (%) 28.6 35.9 45.5 40.7 45.2 RONW (%) 30.9 33.3 29.9 26.5 29.2 PE 9.3 17.5 28.4 24.6 36.8 EBIDTA 11,153.5 9,604.3 7,082.0 5,213.7 4,763.0 DivYield 2.5 1.5 1.0 1.1 0.7 PBV 2.5 5.0 7.3 5.7 9.3 EPS 27.7 117.7 84.2 61.2 55.8
  47. 47. 47 News relevant to the company:- Bharat Heavy Electricals Ltd - Record Date Source: NSE India04/03/2011 Type: Corporate Bharat Heavy Electricals Limited has informed that the Company has fixed March 21, 2011 as the 'Record Date' to ascertain the names of the shareholders/beneficial owners of the company to whom the interim dividend shall be payable, if approved by the Board of Directors at its Meeting to be held on March 15, 2011. Bharat Heavy Eel - Fixes Record Date for Interim Dividend Source: BSE India23/01/2013 Type: Corporate Bharat Heavy Electricals Ltd has informed BSE that February 06, 2013, has been fixed as a Record Date for the purpose of Interim Dividend. Bharat Heavy Ele - Board declares Interim Dividend Source: BSE India01/02/2013 Type: Corporate Bharat Heavy Electricals Ltd has informed BSE that the Board of Directors of the Company at its meeting held on February 01, 2013, has declared and approved payment of Interim Dividend @106% i.e. Rs. 2.12 per equity share for the financial year 2012-13. Interim Dividend shall be paid/ dispatched on February 15, 2013
  48. 48. 48 BHEL to set up 1980 MW thermal power project in Bihar Source: Dion Global05/02/2013 Type: Corporate State-run Bharat Heavy Electricals Ltd (BHEL) today announced that it has secured a contract worth Rs 2,854 crore from Nabinagar Power Generation Company Ltd for setting up a 1,980 MW thermal power project in Bihar. "BHEL has bagged a contract for supply of the Steam Generator Package for three coal-fired thermal units of 660 MW each. Valued at Rs 2,854 Crore, the order has been placed on BHEL by Nabinagar Power Generation Company Ltd," the power plant equipment manufacturer said in a statement. Nabinagar Power Generation Company is a joint venture of NTPC Ltd and Bihar State Electricity Board for this project. BHEL - Updates on Outcome of AGM Source: BSE India19/10/2012 Type: Corporate Bharat Heavy Electricals Ltd has submitted to BSE a copy of the Minutes of 48th Annual General Meeting (AGM) of the Company held on September 19, 2012 Bharat Heavy Ele - Grant of Maharatna status to BHEL Source: BSE India01/02/2013 Type: Corporate Bharat Heavy Electricals Ltd has informed BSE that Ministry of Heavy Industries and Public Enterprises, Department of Public Enterprises vide its letter dated February 01, 2013, has informed that the competent authority has approved the grant of Maharatna status to Bharat Heavy Electricals Limited (BHEL). The delegation of powers, exercise of delegated powers etc. will be governed as per guidelines laid down vide Departments O.M. of even number dated February 04, 2010, which inter alia, provide that the exercise of delegated Maharatna powers is subject to appointment of requisite number of non-official Directors as per SEBI guidelines
  49. 49. 49 Bibliography 1. ltd/stocknews/companyid-11831,cn-bharat-heavy-electricals-ltd.cms 2. ltd/stocks/companyid-13980.cms 3. 4. heavy/bharat-heavy-electricals/BHE 5. Ltd/13510039 6.