Bhel valuation hits a 10-year low

Bharat Heavy Electricals Ltd’s (Bhel’s) trailing 12-month price-to-earnings (P-E) multiple, based on its stand-alone fiscal 2012 earnings, has plunged to a 10-year low at 8.9 times (price as of 31 March). This follows concerns on the outlook for fresh order inflows and to some extent on project execution too. The stock traded at similar valuations way back in 2002, when the global economy seemed shaky after the dot-com meltdown. Thereafter, the P-E multiple had soared four times to around 36 times in March 2008, on optimism that the state-owned enterprise would be among the biggest beneficiaries of the government’s focus on power and infrastructure. And those expectations were met. Annual order inflows surged 41% in fiscal 2008 from 2007, a year which had already seen an 88% increase. more at: http://www.livemint.com/2012/05/23221104/Bhel-valuation-hits-a-10year.html