Review of orders and future growth potential

BEML The Indian government has taken important steps to encourage development and production of domestic defense equipment. It aims to create a sustainable defense industry and reduce dependence on imports.

The “Atmanirbhar Bharat” initiative, which promotes self-reliance, has provided a strong impetus towards achieving this goal. These government policies have opened up opportunities for Indian companies to play a significant role in the design, development and manufacturing of defense equipment.

One company that has profited and continues to profit is BEML. BEML is the second largest earthmoving equipment manufacturer in Asia. The company’s stock recorded an outstanding return of 284.46%. Let’s take a closer look at BEML’s business and take a look at its segments, order book, and future segments.

Bharat Earth Movers Limited

business overview

BEML Limited, formerly known as BEML, is a prominent public sector undertaking (PSU) in India that specializes in manufacturing a wide range of heavy machinery for various sectors including mining, construction, defence, rail and metro transport.

Established in 1964, BEML has grown into a leader in the capital goods industry and has contributed significantly to the development of the country’s infrastructure. The company’s main focus is on the design, development and production of high-quality earthmoving equipment, bulldozers, dump trucks, excavators and other heavy equipment.

In addition to its contributions to the civil and mining sectors, BEML has established a strong presence in the defense manufacturing sector, providing a range of land-based defense equipment including armored vehicles, artillery systems and recovery vehicles.

The company operates in three distinct business segments: Mining & Construction, Defense & Aerospace, and Rail & Subway.
Let’s take a detailed overview of all the company’s business areas.

BEML’s business divisions

Mining and Construction

BEML Mining and Construction segment is noted as a major revenue generator for the company. With a focus on producing heavy equipment for mining and construction activities, the sector is key to supporting India’s infrastructure development.

Although BEML is involved in a variety of sectors, it is important to recognize that the majority of its revenue is generated from the mining and construction sector, which shows its importance to the company’s overall operations.

BEML orders and recent developments

BEML’s Mining and Construction (M&C) business group has demonstrated outstanding performance, contributing approximately 50% of the company’s revenue and achieving its highest ever revenue. India aims to increase annual mining production from the current 893 million tonnes to 1 billion tonnes by 2024, increasing demand for ‘Made in India’ heavy industrial equipment.

Highlighting BEML’s global presence, the company has secured orders for mining and construction equipment from Russia and Indonesia. The implementation of these orders has already begun and is expected to be completed within the year.

railway and subway

BEML’s Rail & Metro division plays a pivotal role in providing rail and metro transport solutions, including the design and manufacture of trains and metro vehicles.
BEML has a strong presence in meeting urban transport needs, with projects underway to supply metro trains to various cities in India. The company is also looking to expand its presence globally, as seen in its collaboration to supply metro cars to Bahrain.

BEML orders and recent developments

A strong pipeline of Rs. The amount of orders received this year and next year is $10 billion, indicating continued growth. BEML has also secured an order for the supply of 10 rakes of Vande Bharat Sleeper trains, the deliveries of which are expected to commence in fiscal 2023-24. International expansion is set to begin soon as BEML has signed an agreement with a Delhi Metro-led SPV. A railway company that supplies subway cars to the Bahrain subway.

Defense and Aerospace

BEML’s defense and aerospace segment is another component of the company’s portfolio. It contributes significantly to India’s defense capabilities and explores aerospace opportunities. This specific sector includes the manufacture of heavy equipment for mining and construction activities.

BEML orders and recent developments

As defense modernization plans ramp up for 2023-24, BEML is particularly eyeing mobility vehicle procurement opportunities. With a strategic focus on local advanced mining equipment, the company aims to meet the growing demand as the Indian government targets annual production. 1 billion tons by 2024.

The construction equipment market outlook is positive and BEML has designed a strategy to strengthen its market share and offer a diversified equipment portfolio. The aerospace segment is growing with partnerships with ISRO and orders of aerospace components from other DPSUs contributing to the overall growth.

BEML’s future prospects

BEML has many plans for the future. Let’s take a look at some of them.

overall performance

Bharat Earth Movers Limited has maintained a significant market share in key segments such as dump trucks, dozers and metro vehicles. The company has already reserved more than 5 million won. 500 billion worth of orders in fiscal 2023 and has a strong pipeline of over Rs. All three business segments hit $1000 billion, demonstrating strong demand for their products.

growth goals

BEML has set ambitious goals for this year, aiming to achieve a growth rate of more than 25% compared to the previous year’s performance. This reflects the company’s commitment to continuous expansion and improvement.

Defense business

BEML is optimistic about strengthening its share of the defense business, which it expects will reach approximately 30% of the company’s total sales this year. Cooperation with other DPSUs and the private sector for the supply of high mobility vehicles, missile programs and aerospace components demonstrates the company’s commitment to strengthening its position in the defense sector.

Mining and Construction

BEML has received orders for mining and construction equipment from Russia and Indonesia, with additional orders worth Rs. Expected to be 30 billion won. The company already has a very large presence in terms of exports.

growth opportunity

Expansion of existing metro networks in Tier-I and Tier-II cities along with new metro projects in the pipeline presents growth opportunities for BEML in the rail and metro business.

Aerospace Opportunity

New opportunities in aerospace, especially through ISRO, highlight BEML’s participation in cutting-edge projects and its contribution to India’s space exploration efforts.

international presence

BEML is actively expanding its international presence, including receiving export orders for motor graders and prime movers from the Philippines. The company is registered on foreign defense portals, indicating a strategic approach to pioneering and entering the global markets of defense, railway, metro, mining and construction equipment.

conclusion

In conclusion, BEML plays a powerful role in India’s defence, infrastructure and manufacturing landscape and is benefiting significantly from the government’s initiatives for self-reliance in defense production under the Atmanirbhar Bharat campaign.

With an impressive order book, substantial international collaborations and a strategic focus on new opportunities, BEML is well-poised for continued growth. Recently, the stock price has soared, recording an incredible return of 284%, attracting great attention from the market.

In the future, BEML plans to continue growing, especially in areas such as metro projects, defense and aerospace. Can they continue their stellar growth with a positive outlook, cooperation with other countries, and rising stock prices? What are your thoughts on this article? Did you find this insightful and informative? Let us know in the comments section below!

Written by Akshita Malu

By leveraging the Stock Screener, Stock Heatmap, Portfolio Backtesting and Stock Comparison tools on the Trade Brains portal, investors have access to comprehensive tools to identify the best stocks, stay updated and informed with stock market news. invest.