Bhel rallied to a new 52-week high on Wednesday by a spate of new project wins.

The market backed the scrip higher by 3.2% to Rs 225.75 on BSE early today even hitting a new 52-week high in the process. High volumes of 3.4 lakh shares were recorded on the counter in one-and-a-half hours of trading. It takes a whole normal trading session usually for Bhel to clock such volumes .

The stock has been witnessing renewed buying interest of late. From Rs 199.55 on 10 March 2003, the scrip has rallied 13.1% to the current Rs 225.75. A major development for the company last week came in the form of its bagging a major order from NTPC . The stock has been a star performer over the last few months. Yet, volatility has also marked the counter. Institutional investors and domestic funds including Alliance Capital Mutual Funds have been picking up the stock of late.

The strong order book of the company and continued order flows have proved significant in improving the scrip's fortunes of late. The proposed Electricity Bill that is slated to be tabled in Parliament soon is also proving a trigger for the stock.

Last week, Bhel bagged a mega order worth Rs 2,125 crore (Rs 21.25 billion) ured a contract from NTPC for setting up the 1000 MW Stage-III of Vindhyachal Super Thermal Power Station in Madhya Pradesh, comprising 2 units of 500 MW. In its efforts to meet the capacity addition target for the Tenth Plan, NTPC has embarked on the negotiation route for finalising the order with Bhel. This methodology shall not only ensure capacity addition of 1000 MW in the Tenth Plan but also save time and cost in the execution of the project, Bhel said then.

Bhel is presently executing contracts at Talcher STPS in Orissa, Rihand STPS in Uttar Pradesh and Ramagundam STPS in Andhra Pradesh for NTPC. All the projects are progressing on schedule.

Bhel is the largest engineering and manufacturing enterprise of its kind in India and is one of the leading international companies in the field of power equipment manufacture. It manufactures over 180 products under 30 major product groups and caters to core sectors of the Indian economy viz., power generation and transmission, industry, transportation, telecommunication, renewable energy, etc.

The Union Budget for 2003-04 has proved to be a mixed bag for Bhel. On the one hand, it has slashed customs duty on high voltage transmission equipment from 25% to 5%. The measure will reduce the total cost of import of such equipment and may put pressure on demand for domestic power equipment. On the other hand, the budget has been held to be favourable for the power sector in the long term due to the proposed reforms in the sector. The budget has laid much emphasis on infrastructure, which could form the core trigger for industrial development. Other announcements include the extension of the mega power project policy to all power projects. Also, the Electricity Bill is expected to be passed in Parliament soon.

Analysts say the Electricity Bill will aim at improving the health of state electricity boards. This, in turn, will help Bhel improve its financials as the power equipment major receives 60% of its revenues from SEBs.

For the third quarter ended 31 December 2002, Bhel posted a net profit growth of 1.5% to Rs 81.33 crore, compared to Rs 80.15 crore in the corresponding period of the previous year. Total income increased by 14% to Rs 1,699.76 crore (Rs 16.99 billion) to Rs 1,490.17 crore (Rs 14.9 billion) in DQ 2001.