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India’s Nuclear Power Stocks – BHEL and HCC: Balancing Opportunity and Regulation

Updated on: Dec 18, 2024, 1:04 PM IST
Nuclear power in India offers immense potential for companies like BHEL and HCC despite being a tightly regulated sector. With plans to triple nuclear capacity by 2031, opportunities abound.
India’s Nuclear Power Stocks – BHEL and HCC: Balancing Opportunity and Regulation
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India’s energy needs are rising, and nuclear power is rising to meet the demand. As the country aims for a low-carbon future, nuclear energy presents an exciting but tightly regulated opportunity for companies involved in this sector. Let’s dive into why nuclear power is becoming critical for India and which stocks could benefit from this growth.

Why Nuclear Power Matters?

India is the 3rd largest electricity producer globally, but with a growing economy, the power demand is only increasing. The country is shifting to renewable sources like solar, wind, and hydro while exploring nuclear energy as a dependable and low-carbon option.

Nuclear power currently contributes around 1.8% of India’s total electricity capacity, with 24 operational reactors adding up to 8,180 MW. While this might seem small, the government is planning big. By 2031, the country aims to achieve 22 GW of nuclear power, almost tripling its current capacity.

Companies Focused on Nuclear Power

Several companies in India are directly involved in nuclear power generation and related infrastructure. Here are the key players:

  • Nuclear Power Corp. of India Ltd (NPCIL): A state-run enterprise under the Department of Atomic Energy (DAE), responsible for operating nuclear reactors in India.
  • Bharat Heavy Electricals Ltd (BHEL): India’s largest engineering and manufacturing company in the energy and infrastructure sectors.
  • Bharatiya Nabhikiya Vidyut Nigam Ltd (BHAVINI): A government enterprise under DAE focusing on advanced nuclear power projects like fast breeder reactors.
  • Hindustan Construction Co. Ltd (HCC): A leading engineering and construction firm with significant expertise in building nuclear power plants.

Other companies offering allied services include IREL (India) Ltd, Uranium Corp. of India Ltd, Electronics Corp. of India Ltd, Larsen & Toubro Ltd, and Mitsubishi Heavy Industries.

BHEL and HCC are publicly listed entities with direct exposure to the nuclear power sector. Let’s investigate their roles and potential benefits from India’s nuclear power expansion.

Spotlight on Key Players

  • Bharat Heavy Electricals Ltd (BHEL)

BHEL, a public-sector enterprise under the Ministry of Heavy Industries, is India’s largest government-owned electrical and industrial technology company. Its portfolio spans multiple critical industries, including energy, renewable technologies, oil and gas, railways, defence, aerospace, water management, and battery storage systems.

BHEL is involved in nuclear, thermal, hydro, gas, and renewable power projects in the energy domain. It specialises in delivering comprehensive power solutions, from conceptualisation to commissioning. 

Specifically, in the nuclear power segment, BHEL produces key components like steam generators, reactor headers, end shields, and nuclear turbine generator systems for reactors ranging from 200MWe to 700MWe. The company handles construction and commissioning activities for nuclear reactors, with NPCIL overseeing operational aspects and upgrades.

BHEL has established itself as a leading supplier of steam generators among Indian manufacturers. In Q2 2025, it delivered its 45th steam generator for the Gorakhpur Haryana Anu Vidyut Pariyojana (GHAVP) Nuclear Power Plant. Furthering its position in the nuclear sector, BHEL signed an MoU with NPCIL in 2023 to explore new opportunities in pressurized heavy water reactor (PHWR) projects.

  • Hindustan Construction Co. Ltd (HCC)

HCC is a well-established engineering and construction firm with expertise in various sectors, including industrial projects, transportation, hydroelectric power, nuclear power, and water infrastructure. In the nuclear energy space, HCC is involved in constructing key facilities such as reactors, auxiliary buildings, turbine generator structures, spent fuel storage units, cooling towers, and control buildings.

The company has made significant contributions to India’s nuclear energy infrastructure, having built facilities with a cumulative capacity of 5,780 MW, accounting for around 60% of the country’s total nuclear capacity of 9,580 MW. However, with several projects still under construction, the operational nuclear power capacity currently stands at 8,180 MW.

During an analyst meeting in Q2 2025, HCC emphasised the specialised nature of nuclear projects, with typically one or two new projects announced annually. The Department of Atomic Energy is responsible for design work, while NPCIL handles implementation. A potential civil works market worth ₹15,000–20,000 crore annually, of which HCC could secure ₹2,000–3,000 crore.

Challenges in the Nuclear Sector

The nuclear power industry in India operates within a highly regulated framework. The Department of Atomic Energy (DAE) oversees all aspects of nuclear energy, from design to implementation. Companies like BHEL and HCC handle construction and commissioning, while NPCIL manages reactor operations.

A major bottleneck is the limited number of projects announced annually. For example, only one or two nuclear projects are typically approved each year, making the market competitive for engineering firms.

The Role of Nuclear Energy in a Low-Carbon Future

Nuclear power is one of the cleanest forms of energy. According to NPCIL, nuclear power emits as little carbon dioxide as wind energy and much less than solar. This makes it a critical part of India’s plan to reduce its carbon footprint.

With fossil fuels contributing significantly to global emissions, nuclear energy offers a reliable alternative to meet India’s growing energy needs while supporting its climate goals.

What’s Next?

The road to expanding nuclear power is not easy. Companies like BHEL and HCC need to navigate a challenging environment with strict regulations and limited projects. However, the growing focus on clean energy and increasing government support could turn nuclear power into a booming sector in the coming years.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.

Published on: Dec 9, 2024, 4:25 PM IST

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