BEML privatisation: Should you invest?

BEML was incorporated in 1964 as a public-sector undertaking with the name Bharat Earth Movers Ltd. It was a spin-off of the railway-coach manufacturing facility of Hindustan Aeronautics. In the late 1960s, the company ventured into manufacturing mining and construction equipment on the back of its technical collaborations with companies based in the US and Japan. The company then underwent a thorough restructuring in 2006 and divided its operations into three business segments: defence and aerospace, mining and construction, and railway and metro trains. BEML is Asia's second largest manufacturer of earthmoving equipment and controls more than 60 per cent of India's market in that sector. The Government of India, which holds 54 per cent stake in the company, is currently inviting bids for selling around 26 per cent stake in the company. Strengths BEML enjoys a dominant position in all of its segments. In mining equipment, the company has the highest domestic market share.