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Yes, the word does mean sisterfucker, literally. The word was used even as early as the 1800s. If you read Lawrence James' book, the 'RAJ', you will find that Bhenchod was used as a common slang even then.The slang is still used across India and Pakistan, more so in villages, by men and women alike.
The pronounciation may change with the region( Baheenchod in UP & Bihar, Bhaincho in Punjab, northern India and Pakistan, and so on...)
bhenchod by The explorer August 9, 2004

bhencadigut 

Someone who is always clueless and never knows what’s going on
Sir, you are a bhencadigut
bhencadigut by Drooov March 29, 2018

Bhencode! 

Multipurpose word meaning "Sister-Fucker". 1. Can be used in almost any situation to portray a variety of emotions, such as excitement, despair, anger, surprise, etc. 2. Used to start to acquire someone’s attention when starting to speak to them. 3. An insult of colossal proportions.
1. Bhenchode! This is great soup!.
2. Bhenchode, when are you coming over.
3. Bhenchode! Take the fucking trash out you lazy ass fuck!
4. Bhenchode! i fucking flunked my test.
5. Fuck you bhenchode!!
Bhencode! by Sami December 5, 2004
It's like the exclamation point at the middle or end of every sentence for people mostly from South Asia.
David: Hey man how you doing?

Amir: Not good bhenchod

David: Woah bhenchod

Amir: What bhenchod?
bhenchod by nomanito May 14, 2016

Bhenchodosity 

1. The act of everything around oneself going into a 'bhenchod' state of affairs.

2. When everything around oneself gets so totally messed up that the English language falls short of the right word to compensate.

Word credit: @silv3rglee Twitter
This day just doesn't seem to end! Absolute bhenchodosity!
Bhenchodosity by silv3rglee December 16, 2011
Usmaan doesnt know what hes talking about and pakis didnt popularize this. Punjabis pronounce it "panchod" -- and yes it means sisterfucker.
"Panchod, what the fuck are you doing?"
bhenchod by Rishi July 26, 2004