BHEL Bags Up To ₹1,500 Crore Order From SAIL

State-run engineering major Bharat Heavy Electricals Ltd has secured a fresh order that could strengthen its presence in the core industrial segment. The company has received a Letter of Acceptance from Steel Authority of India Ltd for setting up a captive power plant as part of a major steel expansion project. The order comes at a time when investor interest in BHEL has also been picking up. So what exactly is the deal about?

What Is The Order That BHEL Has Won?

Bharat Heavy Electricals Ltd has bagged a captive power plant package from Steel Authority of India Ltd for its IISCO Steel Plant at Burnpur in West Bengal.

The project forms part of SAIL’s 4.08 million tonnes per annum crude steel expansion plan. According to the regulatory filing, the contract has been awarded through a global tender route by a domestic entity.

The order size is in the range of ₹1,200 crore to ₹1,500 crore, excluding GST. For BHEL, this qualifies as a significant contract given its scale and execution timeline.

The Letter of Acceptance was received on February 17, 2026.

What Work Will BHEL Execute Under This Project?

The contract has been awarded on a turnkey basis. This means BHEL will handle almost the entire project lifecycle.

Its scope includes design, engineering, manufacturing, supply, transportation, unloading, storage, erection, commissioning, and performance guarantee testing of the captive power plant package. However, civil works are not part of the agreement.

The project is expected to be commissioned within 39 months from the effective date of the contract. Once operational, the captive power plant will support SAIL’s expanded steel production capacity at Burnpur.

For a steel manufacturer, a captive power plant is vital, as it provides power and manages operational costs efficiently.

Why Is This Order Important For Both Companies?

BHEL is an integrated manufacturer of power plant equipment and is one of India’s flagship engineering enterprises operating in the power, transmission, renewable energy, oil & gas, transportation, and defence sectors.

For SAIL, India’s leading steel maker, the expansion of the IISCO steel plant is part of the overall strategy to build capacity within the country.

As a fully integrated iron and steel producer, SAIL supplies basic and special steels to construction, engineering, railways, automotive, and defence sectors.

The captive power plant will play a supporting role in ensuring a reliable energy supply for the expanded crude steel output.

BHEL has also clarified that none of its promoters or promoter group entities has any interest in the awarding authority. It further stated that the transaction does not fall under related-party transactions under the applicable norms.

Also Read - Govt to Sell 3% Stake in BHEL via OFS at ₹254 Floor Price

How Did The Market React?

Shares of Bharat Heavy Electricals Ltd edged up 0.11% to close at ₹262.80 on Tuesday, 17 February, on the National Stock Exchange of India.

The development follows strong investor interest in BHEL’s recent offer for sale. The issue was subscribed 2.3 times on the first day on 11 February, prompting the government to exercise the green shoe option and put the entire 5% stake on the block.

With a sizeable order in hand and visible execution over the next three years, market participants will be watching how efficiently BHEL delivers on the project and whether more industrial orders follow in the coming quarters.

Sources

Business Standard

NDTV Profit

CNBC TV18