BHEL, ABB, L&T plunge up to 14% after report says govt may scrap curbs on Chinese companies

Shares of Bharat Heavy Electricals (BHEL) and other capital goods names plunged up to 14% on Thursday following a media report that said the Ministry of Finance plans to scrap five-year-old restrictions on Chinese firms bidding for government contracts. Reuters reported, citing two sources, that the move may come as the government seeks to revive commercial ties with the dragon nation amid eased diplomatic and border tensions.

State-run Bharat Heavy Electricals (BHEL) plunged 14% and was the worst loser in the pack, hitting the day’s low of Rs 261 on the NSE. BHEL shares finally closed at Rs 276.90, up from the day’s low of 261.50, though still closing nearly 9% lower. This was the biggest single-day drop that BHEL shares have seen since June 4, 2024, when the stock had declined 21%. The Lok Sabha election results were announced on this day.

ABB India closed 5% lower at Rs 5,036 while Siemens ended down 4.3% at 3,000. Larsen & Toubro (L&T) shares settled with a drop of 2.7% on the NSE.

Notwithstanding today’s fall, BHEL shares have outperformed the benchmarks Nifty and Sensex with returns of 20% over a 1-year period. The returns by Nifty and Sensex in the same period are 9% and 8%, respectively.

The overall tone of the market was negative with Nifty ending with cuts of 1% at 25,876.85, falling by 263.90 points while Sensex was down 780 points, settling at 84,180.96.

The selling pressure was witnessed across the board but was more prominent in IT, metals, pharma and PSU bank. While the Nifty PSU Bank fell 3.4%, Nifty IT and Nifty PSU Bank was down 2%, each. Nifty Pharma fell 1.4%.

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