BEML Gears Up for Q2 With Defense, Metro Order Boost; SEBI Analyst Flags 25% Upside Potential

Shares of BEML held steady this week as investors awaited the company’s second-quarter (Q2) results, expected later in October, and updates on new defense and metro project orders. 

The stock has been consolidating in recent weeks but showed signs of recovery, supported by improving technical indicators and strong order visibility.

Analyst View

SEBI-registered analyst Deepak Pal said BEML’s chart has started to look stronger after a few weeks of consolidation. He pointed out that the stock found solid support near ₹4,100 and has since bounced back to around ₹4,360, forming a bullish pattern on the daily chart. 

Pal noted that the stock is now trading above its 20-day and 50-day Exponential Moving Averages (EMAs), a sign that buying interest is returning, while the 200-day EMA around ₹3,880 continues to act as a strong long-term cushion.

He added that the short-term trend looks “neutral to positive,” with the stock gradually forming higher lows. Pal said the Parabolic SAR (Stop and Reverse) indicator has flipped below the price, showing a short-term uptrend, and the Moving Average Convergence Divergence (MACD) has turned positive as its main line moved above the signal line. 

The Relative Strength Index (RSI), currently near 56, also points to balanced momentum and not stretched on either side, suggesting room for the trend to strengthen further.

Technical Setup 

Pal identified support levels between ₹4,150 and ₹4,200, while resistance lies in the ₹4,450–₹4,500 range. He said a breakout above ₹4,520 could open the way for an upward move toward ₹4,700–₹4,850. 

The analyst added that as long as the stock sustains above ₹4,300, the momentum remains intact, though a close below ₹4,150 could lead to mild profit booking.

He said the stock’s recent recovery, combined with improving momentum indicators such as the MACD crossover and Parabolic SAR confirmation, points to a constructive short-term setup for BEML.

Pal added that in the broader view, the stock could deliver 20–25% upside over the next year, supported by a strong order book and steady project execution.

Fundamental Overview

According to Pal, BEML’s FY25–FY26 estimates indicate steady financial performance, with revenue growth projected at around 14–16% year-on-year, supported by strong order inflows from defense and metro projects. 

The company’s current order book stands at about ₹12,000 crore, providing multi-year revenue visibility. Pal added that the company maintains EBITDA margins (Earnings Before Interest, Taxes, Depreciation, and Amortization) near 12–13%, backed by operational efficiency and cost control.

He said BEML continues to maintain a very low level of debt, ensuring balance sheet strength, while return on equity remains healthy at around 14%. 

He added that the company’s diversification across defense, mining, and rail sectors helps reduce business concentration risk and positions it to benefit from rising defense spending and government-led infrastructure investments.

Upcoming Triggers

Pal said markets are expecting a strong set of Q2 FY26 results from BEML, driven by healthy defense and metro order inflows. He noted that maintaining margins above 13% could further lift investor sentiment.

He further pointed out the government’s contemplation of partial stake sale in BEML was another major trigger to look out for as a decision or approval could move the valuation. 

He also informed that BEML would likely win new orders from metro expansion projects in Delhi, Chennai and Ahmedabad. It has also been shortlisted for the supply of defence vehicles to the Indian Army, which will improve its order book.

Pal added that the company continues to benefit from increased government capital expenditure in defense and mining equipment under various policy initiatives.

Outlook And Key Risks

According to Pal, the short-term outlook for BEML remains positive, with the potential to move toward ₹4,500–₹4,700 if it sustains above ₹4,300. In the longer term, he said the company’s solid order book, strategic positioning, and upcoming government projects could continue to support growth momentum.

He cautioned that delays in order execution, fluctuations in raw material costs, or policy-related uncertainties surrounding divestment could pose risks. 

Despite these factors, Pal said BEML’s strong fundamentals, improving technical setup, and steady government project flow make it a stock to watch in both the defense and infrastructure sectors.

What Is The Retail Mood?

On Stocktwits, retail sentiment was ‘neutral’ amid ‘normal’ message volume.

BEML’s stock has risen 6% so far in 2025.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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