297% rally in 3 years! THIS multibagger defence PSU is Choice Broking’s pick of the month; Buy, sell, or hold?

BHEL Share Price Today: Bharat Heavy Electricals Ltd (BHEL) share price gained over four per cent on Tuesday, March 18, and rallied six per cent in the last five sessions on a fresh uptrend. Amid a volatile market on global cues, the defence public sector undertaking (PSU)'s shares have declined eight per cent in one year. The multibagger defence PSU stock has delivered remarkable 279 per cent returns to investors in the last three years.

BHEL has emerged as Choice Broking's stock pick of the month for March. After the latest uptrend, the brokerage is bullish on the multibagger defence PSU stock and has provided a ‘buy’ rating. The state-owned engineering firm posted over two-fold jump in consolidated net profit at ₹134.70 crore for December quarter 2024-25, mainly on the back of higher revenues.

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BHEL logged a profit of ₹60.31 crore in the quarter ended December 31, 2023. Total income rose to ₹7,385 crore in the quarter from ₹5,599.63 crore in the same period a year ago. Domestic power generation rose in the December quarter, although it grew three per cent compared to 12 per cent a year earlier. Power growth slowed down in the latter half of 2024.

Stock Pick of the Month: Choice Broking suggests BHEL for one month 

According to domestic brokerage Choice Broking, the multibagger defence PSU stock BHEL is the stock pick of the month. The brokerage has given a ‘buy’ rating for the PSU stock at ₹201.9 with a target price (TP) of ₹229.7 and a stop loss of ₹188. The stock is currently trading near ₹201.9 and has recently formed an inverted head and shoulders pattern on the daily chart.

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Choice Broking's Stock Pick of the Month: Technical View for BHEL stock

According to Choice Broking, the stock is on the verge of a breakout with significant volume, indicating strong bullish momentum. This reversal pattern has emerged at the bottom of the trend, signalling a potential trend reversal. If the stock manages to close above ₹202.5, it could trigger a strong upward move in the short term, with a target of ₹229.7. 

On the downside, ₹198 will act as an immediate support level, and any dip towards this level can be considered a buying opportunity. The RSI on the daily chart is at 54.8, rebounding from the oversold zone, which strengthens the reversal signal. BHEL is trading above the 20 EMA and is near the 100 EMA, which stands at ₹203.2. A sustained move above this level will further confirm the bullish bias and increase the likelihood of an extended uptrend.

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At the current level of ₹201.9, BHEL offers a favourable buying opportunity for traders. A stop-loss can be placed at ₹188 to manage downside risk, while the upside target remains at ₹229.7, aligning with the broader uptrend and reversal signals. “This setup provides a strong risk-reward ratio for positional traders looking to capitalize on the bullish breakout,” said Choice Broking.

Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts, consider individual risk tolerance, and conduct thorough research before making investment decisions, as market conditions can change rapidly, and individual circumstances may vary.