diff --git a/bp2build/build_conversion.go b/bp2build/build_conversion.go
index ced779c..fde9b69 100644
--- a/bp2build/build_conversion.go
+++ b/bp2build/build_conversion.go
@@ -60,6 +60,15 @@
 	}
 }
 
+// PackageName returns the package of the Bazel target.
+// Defaults to root of tree.
+func (t BazelTarget) PackageName() string {
+	if t.packageName == "" {
+		return "."
+	}
+	return t.packageName
+}
+
 // BazelTargets is a typedef for a slice of BazelTarget objects.
 type BazelTargets []BazelTarget
 
@@ -337,7 +346,10 @@
 			return
 		}
 
-		buildFileToTargets[dir] = append(buildFileToTargets[dir], targets...)
+		for _, target := range targets {
+			targetDir := target.PackageName()
+			buildFileToTargets[targetDir] = append(buildFileToTargets[targetDir], target)
+		}
 	})
 
 	if len(errs) > 0 {
@@ -454,7 +466,8 @@
 
 	targetName := targetNameWithVariant(ctx, m)
 	return BazelTarget{
-		name: targetName,
+		name:        targetName,
+		packageName: ctx.ModuleDir(m),
 		content: fmt.Sprintf(
 			soongModuleTargetTemplate,
 			targetName,