Bhel touched its multi-month high on Friday on sustained buying support.

The stock of the state-run power equipment major was up 2.2% at Rs 191.50 on the BSE in mid-afternoon trades. It hit a high of Rs 193, recording its highest level in the last few months since 8 April 2002, when the scrip had hit a high of Rs 193.40 (intra-day high). 580,000 lakh shares changed hands on the counter today.

The Bharat Heavy Electricals stock is witnessing support of late. As per market buzz, foreign brokerage Salomon Smith Barney was active on the counter.

The Bhel stock has witnessed sustained buying support from an early November 2002 low, on the back of slew of new order wins in recent months. From a low of Rs 145.55 on 1 November last year, the stock has gained 31.5% in two-and-half months to the current Rs 191.50.

Analysts expect Bhel to come out with improved results for the remaining two quarters. They said the cost-cutting drive would help the company in the coming years. The company is said to be targeting raw material cost reduction at all its manufacturing facilities by 2% every year.

Bhel has secured various contracts aggregating Rs 4,000 crore (Rs 40 billion) in the last few months, according to a domestic brokerage. Among the major recent order wins include a $74 million order to set up an 800-MW hydro electric project for National Hydro Electric Power Corporation. The project is expected to be completed in 52 months. Bhel's order book stood at Rs 13,500 crore (Rs 135 billion) as at end September 2002.

Bhel is at present emphasising on project and product exports in a bid to ensure a sustained pace of growth in its overseas business. The company has been looking at business opportunities in the operation and maintenance area abroad.

Recently, the Centre decided to sell 17% equity stake in Bhel to bring down its holding in the company to 51%, from 67.7%. The heavy industry ministry has given its concurrence to the proposal for divesting 17% stake to the public, financial institutions and employees.

In Q2 ended 30 September 2002, Bhel reported a 26% drop in net profit to Rs 108.54 crore (Rs 1.08 billion) on a 10.5% fall in sales to Rs 1,289.13 crore (Rs 12.89 billion). Bhel's Q2 results were affected due to an export order of Rs 100 crore (Rs 1 billion) getting held up at the port, which resulted in lower sales.