BHEL margin rebounds as Q4 revenue growth outpaces costs
Standalone operating margin rose 4.99 percentage points YoY, though lower tax and other income also supported the sharp increase in net profit.
Filed 04 May 2026, 18:27 IST · after market close · Bharat Heavy Electricals Ltd (BHEL)
Key takeaways
- Standalone operating margin rebounded to 14.24%, up 4.99 percentage points YoY as revenue grew 36.88% faster than expenses at 29.35%.
- Standalone net profit rose 154.47% YoY to Rs 1,282.68 cr, but other income contributed 14.66% of pre-tax profit and the tax rate fell 2.98 percentage points.
- The stock fell 0.56% in the first session after the after-close filing, within a history of four positive and four negative result reactions with a median absolute move of 5.40%.
Price around the results
Q4FY26 brought a sharp operating recovery
BHEL's standalone revenue growth accelerated to 36.88% YoY, while expenses grew 29.35%, allowing operating profit to rise 110.79%. The same pattern was stronger sequentially: revenue grew 45.29% against expense growth of 33.17%, lifting operating margin by 7.80 percentage points to 14.24%.
Profit growth had a tax and other-income boost
Net profit increased 154.47% YoY, well ahead of the 144.28% rise in pre-tax profit. The tax rate declined 2.98 percentage points to 25.42%, which supported the net-profit increase, while other income accounted for 14.66% of pre-tax profit. Interest expense was also 1.94% lower YoY.
Margin recovered from the Q3 dip but remains below peers
The 14.24% margin marked a recovery from 6.44% in Q3FY26 and 7.73% in Q2FY26, following a -9.79% margin in Q1FY26. It was 1.42 percentage points below the 15.66% median for the 71 Industrials companies that had reported the same quarter.
The initial market reaction was quieter than past results
After the results were filed after market close, the stock fell 0.56% in the first session, then gained 2.36% after one session and 3.90% after five sessions. The five-session move was below the 5.40% median absolute reaction across the company's past eight results, where reactions were evenly split between gains and declines.
Q4FY26 at a glance
Standalone figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹12,310 cr | ₹8,473 cr | +45.29% | +36.88% |
| Other income | ₹252 cr | ₹227 cr | +11.03% | +58.78% |
| Expenses | ₹10,557 cr | ₹7,928 cr | +33.17% | +29.35% |
| Operating profit | ₹1,753 cr | ₹545 cr | +221.49% | +110.79% |
| Operating margin (%) | 14.24% | 6.44% | — | — |
| Interest | ₹198 cr | ₹182 cr | +8.25% | -1.94% |
| Depreciation | ₹88 cr | ₹78 cr | +12.71% | +3.39% |
| Profit before tax | ₹1,720 cr | ₹512 cr | +235.95% | +144.28% |
| Tax | ₹437 cr | ₹129 cr | +237.73% | +118.59% |
| Net profit | ₹1,283 cr | ₹382 cr | +235.35% | +154.47% |
| EPS (₹) | ₹3.68 | ₹1.10 | +234.55% | +153.79% |
Operating margin of 14.24% compares with a Industrials sector median of 15.66% across 71 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -0.56% | -0.20% |
| Next session | +2.36% | — |
| 5 sessions | +3.90% | +6.97% |
| 15 sessions | +10.79% | — |
| 30 sessions | +4.03% | — |
Volume on the results session was 1.33× its 20-day average.
What to watch
- Whether standalone operating margin holds above 14.24% after the Q4 recovery.
- Whether other income remains a material part of pre-tax profit relative to the 14.66% share reported in Q4FY26.
- Whether revenue growth continues to outpace expense growth, as it did at 45.29% versus 33.17% sequentially.