SAIL, BHEL and BEML were among major gainers in the PSU space on Monday while overall trend in the market was positive despite tariffs threats from US President Donald Trump. Either the markets have started to ignore threats given by President Trump or the risks associated with tariffs have been already factored in the price. Another scenario is that actual tariffs could be much lower if India and United States cement a strong trade deal. Steel stocks were in demand and even Tata Steel, JSW Steel closed with decent gains. SAIL jumped 4.56 percent while Tata Steel gained 4.08 percent. BHEL closed 4.58 percent higher after touching intraday high at Rs 242.2. TopNews Team has reviewed technical and fundamental levels for these stocks for short term traders and investors.

SAIL: Surging Production, Prudent Deleveraging, and Strategic Expansion

Steel Authority of India Limited (SAIL) has marked a watershed moment in Q1FY26, delivering its highest-ever first-quarter sales at 4.55 million tons—an impressive 15% year-over-year increase. Coupled with a 2.7x surge in profit before tax to ₹890 crore and net profit reaching ₹745 crore, the numbers paint a vivid picture of operational momentum and robust end-market demand. The company’s 12% YoY spike in saleable steel output highlights its manufacturing prowess and affirmation of its growth trajectory.

A pivotal factor in SAIL’s latest performance is the sharp drop in imported coking coal prices. While a one-time ₹1,050 crore stock valuation adjustment reflected this cost swing in the quarterly accounts, it was characterized by the company’s finance leadership as an accounting event rather than operational adversity. Critically, the decline in coal input costs has afforded SAIL enhanced margin performance—a crucial lever if global commodity prices remain subdued, offering potential for earnings stability going forward.

SAIL’s financial resilience is further amplified by a reduction in borrowings by ₹1,100 crore, cementing a healthier balance sheet amid ongoing expansion. As of June 30, total borrowings stand at ₹28,741 crore, and the company is targeting an assertive ₹7,500 crore in capital expenditure over the fiscal year. These investments signal ambitions to scale and modernize, potentially unlocking additional earnings power.

Yet caution abounds: annual sales contracted 2.9% in the previous year—the first such reversal in three years—suggesting that while short-term catalysts abound, sustained topline growth is not assured without flawless execution and favorable market dynamics.

Analyst sentiment remains polarized. While Axis Securities maintains a bullish stance with a ₹195 target, others such as Prabhudas Lilladher urge HOLD, citing the importance of meeting FY26 sales guidance (18.5 million tons) and delivering on capex. The broader analyst consensus is split: among 24 tracked experts, just 1 is at Strong Buy, with notable clusters at both the Hold and Sell ends of the spectrum. This diversity of views reflects the complex cocktail of operational strength, sector cyclicality, and global demand uncertainty—especially from crucial export markets like China.

At a PE multiple of 16.35 and PB of 0.84, SAIL trades at a conservative relative valuation—perhaps a nod to underappreciated deleveraging or the risk premium attached to steel’s cyclical fortunes. The stock currently trades at ₹125.48, about 20% off its 52-week high.

BHEL: Volatility, Institutional Support, and the Challenge of Price

Bharat Heavy Electricals Limited (BHEL) has experienced a noteworthy turnaround in short-term market sentiment: its stock jumped 4.23% on August 4, 2025, reaching ₹241.40, a move that decisively outperformed both sector peers and the broader market. This uptrend, sparked by renewed investor engagement and notable trading volumes, comes after a recent period of pressure in which the stock shed 7.21% in a month and 19.99% over the past year—substantially underperforming benchmark indices and its own sector.

Institutional investors remain relatively committed, with institutional holdings at 24.86%, underscoring faith in the company’s fundamentals despite short-term volatility. The underlying story is one of resilient operations: annual operating profits have climbed 27.04%, and a modest debt-to-equity ratio of 0.03 highlights strong balance sheet discipline. Revenue growth of 17.86% year-over-year—well ahead of its three-year CAGR—suggests further momentum in its core engineering operations.

Market focus now sharpens to the upcoming quarterly results on August 6, 2025, as analysts and investors look for refreshed guidance on both topline and order book trends. Consensus is mixed: notable analyst recommendations from earlier in the year include a BUY at ₹250.35 (targeting ₹324) and a HOLD at ₹244.45 (targeting ₹237), encapsulating a general theme of cautious optimism. In aggregate, among 19 analyzed opinions, sellers edge out buyers, with 4 Strong Sells and 5 Sells versus 3 Strong Buys and 4 Buys—a blend that highlights trepidation over valuation and growth visibility.

Valuation remains front and center. With a PE ratio of 151.05 and PB of 3.26, BHEL stands out not only for its market cap of ₹84,067.46 crore but for its price premium compared to earnings—a function of recovering but still moderate absolute profitability. The stock’s volatility is marked, with a beta of 1.91, signaling responsiveness to both sector developments and macroeconomic inflections, especially government capital expenditure cycles.

Despite near-term pulls and pushes, the longer-term graph is revealing: BHEL’s share price has soared 358.56% over the past three years, evidence of its recovery from a severely depressed base. Nevertheless, the more recent 20% annual decline is a reminder that lofty valuations and sector sensitivities continue to pose real risks.

BEML: Momentum Play Fueled by Liquidity, Orders, and Reform

Bharat Earth Movers Limited (BEML) is coursing through a period of exceptional price performance and investor optimism. Over the past three months, the stock has surged nearly 50%, culminating in anticipatory gains ahead of a crucial board meeting on July 21, 2025, to consider a stock split. Traditionally an event that draws strong retail interest and enhances liquidity, the stock split potential drove shares up 1.68% to ₹4,499 in pre-event action.

Despite this rally, BEML has experienced a marginal -3% performance year-over-year and remained flat over the preceding month. This dynamic is largely attributed to sector profit-taking and rotation, particularly as defense stocks (including BEML) felt the ripple effects of a peer downgrade and easing geopolitical anxieties. For broader context, the Nifty defense index slipped 2.3% in late July amid this rebalancing. Yet, BEML’s technicals remain favorable, with the stock trading above key moving averages, reinforcing technical strength.

Operationally, BEML has posted spectacular quarterly revenue growth of 88.16%—the strongest in three years—on the back of international order wins and a focus on indigenous manufacturing. The government’s “Make in India” push, allied with robust infrastructure spending, has set a solid platform for ongoing topline acceleration. On the financials, the company has exercised judicious cost management: interest accounted for just 1.35% of operating income, while employee costs comprised 20.54% in FY25. The company’s market capitalization as of August 4 is ₹16,646.81 crore, and the valuation premium—with a PE of 54.91 and PB of 5.56—signals market faith in both restructuring potential and long-term growth.

Analyst coverage is limited (only four tracked), but skews distinctly optimistic: recommendations skew toward BUY and STRONG BUY, prioritizing defense sector expansion and government procurement catalysts. The outcome of the stock split, as well as further order wins, will determine whether sentiment remains buoyant or profit booking reappears should external risks or execution hiccups emerge.

Performance-wise, BEML’s shares are up 16.37% over the past six months, with its 52-week high and low at ₹4,874.80 and ₹2,350.00, respectively. While the growth trajectory is promising, analysts urge close attention to fundamentals, governance, and prudent management in the wake of a sharp rally.

Investor Takeaways: Weighing Valuation, Growth, and Sector Dynamics

The landscape for investors in SAIL, BHEL, and BEML is marked by clear opportunity—but not without risk. SAIL’s blend of record profits, deleveraging, and capital investment is undeniably robust, but ongoing global steel price volatility and cyclicality demand vigilance. For BHEL, the path forward is likely to be characterized by volatility amid government contract cycles, with valuation remaining an obstacle until absolute earnings catch up. BEML stands out for its technical momentum, order pipeline, and policy catalysts, yet faces the challenge of justifying premium valuations and translating sector tailwinds into sustainable earnings.