2. 2
SECTOR ANALYSIS
BHARAT HEAVY ELECTRONICS LIMITED
INFRASTRUCTURE SECTOR
The contribution of the Infrastructure Sector in the India GDP
Infrastructure Sector Growth Rate in India GDP came to 3.5% in 1996- 1997 and the next year, this
figure was 4.6%. The Growth Rate of the Infrastructure Sector in India GDP increased after the Indian
government opened the sector to 100% foreign direct investment (FDI). This was done in order to
boost the Infrastructure Sector in the country. The result of opening the sector to the private sector has
been that Infrastructure Sector Growth Rate in India GDP has increased at the rate of 9%. It is
estimated that the Growth Rate of the Infrastructure Sector in India GDP will grow at the rate of 8.5%
between 2006 and 2010. The biggest ongoing project in the Infrastructure Sector in India is the Golden
Quadrilateral, which is improving the main roads that connect the four cities of Chennai, Mumbai,
Delhi, and Kolkata.
3. 3
According to the Department for Promotion of Industry and Internal Trade (DPIIT), FDI in
construction development (townships, housing, built-up infrastructure and construction development
projects) and construction (infrastructure) activity sectors stood at US$ 26.17 billion and US$ 26.30
billion, respectively, between April 2000-December 2021. In FY21, infrastructure activities accounted for
13% share of the total FDI inflows of US$ 81.72 billion.
The Infrastructure in India is estimated to grow at a CAGR of approximately 7% during the forecast
period.
· Government plans to invest about INR 102 lakh crore on infrastructure projects by 2024-25. The five-
year-long National Infrastructure Pipeline (NIP) will enter its second year in FY21, during which INR
1,950,397 crores are to be invested. About INR 19.5 lakh crore has been budgeted during FY21 as part
of the NIP. Urban infrastructure, road transport, energy, and Railways account for about 70% of
allocation this 2020.
· About 42% of the projects in the NIP are under implementation, which means construction work is
already going on. Another 19% is under a development stage, while a big 31% is still in the conceptual
stage
· During the fiscals 2020 to 2025, sectors such as Energy (24%), Roads (19%), Urban (16%), and
Railways (13%) amount to around 70% of the projected capital expenditure in infrastructure in India
5. 5
According to the Department for Promotion of Industry and Internal Trade (DPIIT), FDI in
construction development (townships, housing, built-up infrastructure and construction development
projects) and construction (infrastructure) activity sectors stood at US$ 26.17 billion and US$ 26.30
billion, respectively, between April 2000-December 2021. In FY21, infrastructure activities accounted
for 13% share of the total FDI inflows of US$ 81.72 billion
SECTOR (GROSS VALUE ADDED)
GVA (Rupees in Crore) at constant prices
2012-13 2013-14 2017-18
2018-
19
2019-
20
2020-
21
1 Agriculture Sector 0.65 6.8 6.61 2.56 4.31 3.63
1.1
Agriculture,forestry
& fishing
0.65 6.8 6.61 2.56 4.31 3.63
2 Industry Sector 9.58 7.72 5.86 5.31 -1.23 -6.96
2.1
Mining &
quarrying
10.15 9.84 -5.62 0.28 -2.54 -8.53
2.2 Manufacturing 13.06 7.93 7.53 5.28 -2.44 -7.15
2.3
Electricity, gas,
water supply &
other utility
services
4.72 9.97 10.61 8.01 2.05 1.9
2.4 Construction 3.6 5.91 5.22 6.34 0.98 -8.61
3 Services Sector 9.44 8.46 6.34 7.2 7.19 -8.36
3.1
Trade, hotels,
transport,
communication and
services related to
broadcasting
10.24 7.71 10.34 7.14 6.4 -18.2
3.2
Financial, real
estate & prof servs
10.66 8.64 1.77 7.16 7.27 -1.5
3.3
Public
Administration,
defence and other
services
6.12 9.33 8.35 7.39 8.29 -4.62
GVA at basic
prices
8.03 7.97 6.23 5.9 4.14 -6.16
6. 6
GROWTH AND DEGROWTH OF INFRASTRUCTURE SECTOR IN INDIA
PEER COMPARISION
Name P/E Sales Rs.Cr.
CMP
/ BV
PAT
12M Rs.
Cr.
ROE %
Ind
PE
EV /
EBITDA
Siemens 76.12 14264.4 7.69 1045.6 10.97 35.65 42.39
HavellsIndia 64.53 13938.48 12.86 1196.47 21.41 35.65 39.15
A B B 94.86 7273.22 11.65 496.31 11.3 35.65 56.73
CG Power&
Indu.
26.98 5561.4 24.53 913.6 207.14 35.65 35.18
CromptonGr.
Con
34.62 5356.41 11.07 658.24 35.71 35.65 27.13
B H E L 20319.88 0.71 -1501.26 -9.88 35.65 -12.56
Hitachi Energy 96.9 3770.51 13.11 126.44 13.56 35.65 42.3
Growth/ Degrowth
I would like to say here that as far as i analyze the infrastructure sector than we found that.
7. 7
Growth but minimal in electricity generation by 3.25
National Highway construction by 29.90
Growth in rail freight but little growth by 3.06
And Degrowth in Railway earning by -8.06 and Cargo at major ports by -4.59
And I thinl it will growth because huge investment of FDIs . so it will expected growth
Porter’s Five Forces Model Of Infrastructure sector
8. 8
INTRODUCTION
Established in 1964, Bharat Heavy Electricals Limited (BHEL) is the largest engineering and
manufacturing enterprise in India in the energy and infrastructure sector with the capability to
manufacture the entire range of power plant equipment. The company caters to the core sectors like
power generation, transmission, industry, transportation, renewable energy, oil & gas, water, defence
and aerospace and e-mobility and energy storage solutions and has references in 83 countries across
the globe. BHEL’s mammoth size of operations is evident from its widespread network of 16
manufacturing units, two repair units, four regional offices, eight service centres, one subsidiary, three
overseas offices, five joint ventures, 15 regional marketing centres and more than 150 project sites
across India and abroad.
BHEL has installed more than 1000 utility sets in thermal, hydro, nuclear and gas-based power plants,
contributing to 53% to the total installed conventional power generation capacity in the country.
Company Website: www.bhel.com
SWOT analysis of the company
Strengths of BHEL
Huge Customer Base:It has a great market influence in the domestic business which makes it a huge strength
for BHEL.
Quality: The quality of BHEL is quite strong and it provides a quality manual for the entire organization.
Research and Development: It is a strong, innovative and creative advanced team for research and development
which is a pro point. They invest 2.5% of their annual turnover in the R&D of BHEL.
Continuous Profits: This is a great strength for BHEL since it has been getting huge profits and dividends for
years.
Support From Collaborators: BHEL has been getting constant and huge support from collaborators that helps for
modern technologies and transform them to suit it according to Indian conditions.
Strong Base in Engineering: Since it has a strong base in engineering, it is stable in the market and industrial
relationship. It is the largest power generation equipment manufacturer with products like gas and steam
turbines, boilers, electric motors, heat exchangers, etc.
Weaknesses of BHEL
Longer Delivery Cycles: Its products take more time to deliver than its international competitors which
can be a huge con according to the customer base.
Less Marketing Manufacture: BHEL lacks marketing manufacture which leads to inadequate supply.
Criticism: The project at Rampal of the coal power plant is criticized a lot for impacting adverse
effects to the environment since it is near to the Sundarbans mangrove forest.
9. 9
The Inability of Certain Activities: Inability of certain activities such as providing suppliers credit, soft
loans and financing power projects.
Net Profit: BHEL’s net profit which is Rs 1.472 Crore is relatively low compared to its annual revenue
of Rs 22,066 Crore. BHEL should strictly look after its expenses and competitors’ business matrix.
Opportunities for BHEL
Demand for Power Domain: There is a huge power domain to produce more equipment. This provides
a huge opportunity for BHEL.
Ageing Power Plants: Since it has more old and required services and is in the market for a long time it
has faster machinery and more market visibility compared to its competitors.
Joint Venture with Siemens: It is a tie-up for a project which can be beneficial and will provide more
scope of growth in the market.
Increase in Defence Budget: An increase in defence seems a good opportunity for BHEL. They can
supply a required tender of locomotives to the Indian Armed Forces.
Procurement Process: The procurement process at BHEL is subject to audits and thus is very
cumbersome.
Increased Private Sector Participation: Since it has a healthy work environment, it has greater circles of
distribution and operation.
Threats to BHEL
Competitors: BHEL faces a lot more competition in every way that is national as well as international
level.
Increase in Small Contractors: The increase in small contractors can lead to price wars which can be a
huge threat for BHEL.
New Players in the Market: The emerging new players and competitors can be a huge threat to BHEL
in the long run.
Associations in the Industry: Associations have reduced the company’s turnover drastically which
becomes a great threat for the company.
10. 10
PRODUCTS
Power
Air Preheaters
Boilers
Control Relay Panels
Electrostatic Precipitators
Fabric Filters
Fans
Gas Turbines
Hydro Power Plant
Piping Systems
Pulverizers
Pumps
Seamless Steel Tubes
Soot blowers
Steam Generators
Steam Turbines
Turbogenerators
Valves
Steam turbines
compressors
Turbo generators
Heat Exchangers
Pulverisers
Switch Gears
Gear Boxes
Oil Rigs
Industry
Capacitors
Ceralin
Compressors
Desalination Plants
Diesel Generating Sets
Industrial Motors & Alternators
Gas Turbines
Oil Field Equipment
Solar Photovoltaics
Power Semiconductor Devices
Seamless Steel Tubes
Sootblowers
Steel Castings & Forgings
Steam Generators
Steam Turbines
Turbogenerators
Valves
Transmission
Bushings
Capacitors
SERVICES
Power Generation Systems
Turnkey power stations.
Combined–cycle power plants.
Cogeneration systems.
Modernisation and rehabilitation of power
stations.
Erection commissioning, operation and
maintenance services.
Spares management.
Consultancy services.
Transmission Systems
Sub–stations switchyards.
HVDC transmission systems
Shunt and series compensation systems.
Power system studies.
Erection commissioning, operation and
maintenance services.
Consultancy services.
Transportation Systems
Traction systems
Urban transportation systems.
Erection commissioning, operation and
maintenance services.
Consultancy services.
Industrial Systems
Industrial drives and control systems.
Erection commissioning, operation and
maintenance services.
Spares management.
Consultancy services.
11. 11
Control Relay Panels
Dry–type Transformers
Energy Meters
HVDC Transmission System
Insulators
Switchgears
Power Semiconductor Devices
Power System Studies
Control Shunt Reactor
Transportation
Electric Rolling Stock
Electrics for Rolling Stock
Electrics for Urban Transportation
System
Non Conventional Energy Source
Mini/Micro Hydro Sets
Solar Lanterns
Solar Photovoltaics
Solar Water Heating Systems
Wind Electric Generators
R&D Products
Fuel Cells
Surface Coatings
Automated storage & Retrivals
Load Sensors
Transparent Conducting Oxide
12. 12
Competitor Analysis
COMPANY
LAST
PRICE
MARKET
CAP. SALES
TURNOVER
NET
PROFIT
TOTAL
ASSETS
(RS. CR.)
Larsen& Toubro 1,622.60 227,983.42 73,315.59 11,336.97 85,108.07
Siemens 2,217.30 78,958.05 12,963.10 1,103.00 11,173.30
HavellsIndia 1,238.85 77,589.18 10,427.92 1,039.64 5,851.62
Bharat Electron 228.2 55,603.21 14,063.83 2,065.42 12,288.43
Hind.Aeronautics 1,580.00 52,833.62 22,754.58 3,232.96 26,410.89
A B B 2,253.90 47,760.14 6,934.00 519.71 4,136.53
PolycabIndia 2,424.65 36,236.39 8,736.36 831.33 4,866.93
SchaefflerIndia 2,284.50 35,706.74 5,560.51 629.12 3,717.85
Voltas 1,069.00 35,373.21 6,377.97 570.3 5,193.25
HoneywellAuto 39,801.20 35,184.26 3,042.78 460.04 2,696.82
Sona BLW Precis. 595.9 34,821.42 767.17 188.04 1,620.27
Bharat Forge 659.8 30,720.29 3,651.51 312.09 9,809.16
LATEST NEWS
BHEL bags order for compressor package from Iraq
State-owned engineering firm Bharat Heavy Electricals Ltd (BHEL) has won an order for compressor
package from Iraq.
The order for the package for Baiji Refinery in Iraq has been placed by Northern Refineries Company
(NRC), a National Oil refinery company owned by the Ministry of Oil, Iraq.
BHEL has achieved yet another milestone in its international business by bagging a prestigious order
for a compressor package from Iraq, a company statement said.
13. 13
The order envisages the design, engineering, manufacturing and supply of an electric motor driven
recycle gas centrifugal compressor.
It will be executed by BHEL’s International Operations Division and its manufacturing units at
Hyderabad and Bhopal. The new compressor will replace the existing compressor, also supplied by
BHEL in 2000, which was damaged due to the war in Iraq.
BHEL has a strong presence in Iraq, having supplied several gas turbine-based power plants, including
4×157 MW gas turbine generator (GTG) units for Baiji Power Station and 2×125 MW GTG units for
Rumailla Power Station.
It has also executed a turnkey order for the construction of the 4×125 MW gas turbine-based
Sulaymaniyah Power Project in Iraq.
BHEL’s portfolio of having supplied over 400 gas/air compressors for various industries/applications –
covering a wide range of pressures and flow, and handling numerous types of gases is a testament to its
robust presence in this segment, the statement said.
In the international market, BHEL has so far supplied compressors to France, Bangladesh, Iraq, Iran,
Oman and Belarus.
The company is continuously expanding its overseas footprints and today has a presence in 88
countries, the statement added.
The cumulative portfolio of BHEL’s overseas power projects stands at 17 GW, out of which over 11
GW has already been commissioned.
Geographical revenue mix,segment wise revenue mix, client wise revenue
mix.
Particulars 2020-21 2019-20
Revenue from Goods & Services 16296 20491
Other Operational Income 1013 969
Other Income 370 581
Total Income 17679 22041
14. 14
Particulars 2020-21 2019-20
Consumption of raw material & components 8159 11780
Civil, erection & engineering expenses 2912 2947
Sub total 11071 14727
Changes in inventories of finished goods and work
in progress
511 (1042)
Total 11582 13685
Material cost % of revenue 71 67
Particulars 2020-21 2019-20
Revenue from Goods 13011 15057
Revenue from Services 3285 5434
Total Revenue from Goods and services (as per
Ind AS 115)
16296 20491
Comparative analysis of P&L statement
Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 TTM
Sales + 28,465 28,827 30,441 21,463 17,309 20,320
Expenses + 27,370 27,174 28,409 21,596 20,357 22,005
Operating Profit 1,095 1,653 2,032 -133 -3,049 -1,685
OPM % 4% 6% 7% -1% -18% -8%
Other Income + 753 679 662 590 393 357
Interest 413 330 378 613 467 339
Depreciation 850 787 476 503 473 355
Profit before tax 586 1,215 1,840 -659 -3,596 -2,021
Tax % 22% 64% 46% -123% 25%
Net Profit 457 441 1,005 -1,466 -2,697 -1,501
15. 15
Fixed assets added during the year and depreciation% chargedon each type
of asset
Description Depreciation/ Amortisation Net Block
Accumulated
Depreciation
as at
01.04.2020
Depreciation/
Amortisation
for the year
Depreciation
Adjustments
Accumulated
Depreciation
as at
31.03.2021
Net Block as at 31.03.2021
LAND -
Freehold land
(including
development
expenses)
Buildings
- Freehold
Buildings
Roads, bridges
& culverts
Drainag e,
Sewerage &
water supply
Plant &
Equipment
Railway Siding
Locomotives &
Wag ons
Furniture &
fixtures
Vehicles
Office and
Other
equipments
Electronic Data
Processing
Equipment
Electrical
Installations
Construction
Equipment
Fixed Assets
costing upto `
10,000/-
Solar power
g eneration
Rig ht-of-use
Assets
- - - -27.71
514.58 92.01 (0.04) 606.56 1100.52
12.82 0.73 - 13.56 2.30
5.96 1.09 - 7.04 24.13
2063.72 202.52 (0.32) 2265.93 831.28
4.20 0.67 - 4.87 3.98
13.74 2.16 - 15.90 12.43
34.64 6.27 (0.95) 39.96 21.99
7.21 1.60 - 8.81 5.56
97.17 13.28 (0.13) 110.32 28.05
50.84 25.30 21.31 97.46 35.74
149.74 24.48 (0.06) 174.16 67.04
66.62 2.66 (1.80) 67.47 3.65
18.37 3.34 (0.63) 21.08 -
16.09 5.88 - 21.97 97.58
259.62 64.26 (32.70) 291.18 164.19
TOTAL 3315.33 446.25 (15.32) 3746.26 2426.15
20. 20
CONCLUSION
Strategic intent is a very important part which should be developed and implemented for the
organization’s success and growth and in the strategic intent the various strategies which are adopted
by various organizations. BHEL is poised to take up the challenge and play a major role in meeting the
energy demand of the country. BHEL make the country Self Reliant in Power Plant Equipment
manufacture, the company has grown in stature in both domestic and international markets BHEL
expected to cater to both power and Industry sectors and will play a major role in meeting the energy
demand of the country.After studying BHEL we have found out that it is always adopting innovative
strategies so that it can continue to grow and also earn profits for its shareholders.
THANK YOU…
