With a market capitalization of ₹ 71,999 crores, ABB India is a large-cap company with operations in the industrial sector. It manufactures power equipment and supplies a complete range of engineering, products, solutions and services in areas of automation and power technology.
The shareholding pattern of ABB India shows that FIIs have been increasing their stake in it for the past three quarters. FIIs held a 3.53% stake in the company in the June quarter of 2022 (Q1FY23) and increased it to 5.39% in the September quarter (Q2FY23). Later they increased their stake in the company to 7.55% in the December quarter (Q3FY23).
An increase in FII activity gives retail investors an indication that the company is likely to perform better going ahead and there is a likely increase in its share prices. However, experts believe that there is no direct correlation between the rise in FIIs holding and share price performance at least in a shorter duration.
In another development, the company’s board has recommended a dividend of ₹ 5.50 per share for Q3FY23, or 275% on 21,19,08,375 equity shares with a face value of ₹ 2 each, subject to shareholder approval.
It added that the dividend, if declared, will be paid/dispatched after May 04, 2023, to those shareholders whose names appear in the register of members at the end of business hours on April 27, 2023. The company’s 73rd annual general meeting will take place on May 04, 2023, at 11 AM in Bengaluru.
ABB India has an ideal return on equity of 22.83% and an ideal debt-to-equity ratio of 0.01. Its shares were trading at a price-to-earnings ratio of 70.83, which is very high compared to the industry P/E of 37.26, indicating that the stock might be overvalued compared to its peers, or investors are willing to pay a higher price for its future earnings. Its shares were trading at ₹ 3289.65 levels on Tuesday.
Written by Simran Bafna
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