With a market capitalization of Rs 2,15,849.83 crore, the shares of this Capital Goods stock touched a day’s high of Rs. 6,061.15 which is a 0.30 percent decline from the previous closing price of Rs. 6,079.30 apiece. This stock has delivered around 47 percent return in the past year and thus outperformed the nifty index in the same period.
Brokerage Recordation:-
UBS, one of the globally reputed brokerages firm, gave a ‘Buy’ call from a ‘Neutral’ rating on the stock with a target price of Rs 8,000 apiece, indicating a potential upside of 31.59 percent from Friday’s closing price of Rs 6,079.30 per share.
Brokerage rational:-
As per the brokerage firm, they believe Siemens India Ltd business mix is more diversified and resilient compared to its competitors with 65 percent of the revenue from electrification which can benefit from a strong cycle. The market has not priced in the potential from the global energy cycle to drive its exports higher from the capital expansion and demerger. The recent de-rating was linked to the slowdown in government capital expenditure as compared to the concerns about its orders and earnings. In their view, they look at Siemens which is trading at around 55x on UBS FY26E EPS (near to five-year average). The key risks include a slowdown in Transmission and Mobility Capital Expenditure.
Further, UBS projects the orders to grow at 24 percent CAGR over the FY24-28E from one HVDC (transmission) and a locomotive (mobility) order. A 60 basic point margin expansion over the FY24-27F the company’s ability to increase margins through higher exports and a strong cycle in the electrification segment.
Financial performance:-
The company’s revenue increased by 11.24 percent, increasing from Rs. 5,808 crore in Q2FY24 to Rs. 6,461 crore in Q2FY25. However, net profit increased by 45.27 percent from Rs. 572 crore to Rs. 831 crore in the same period.
Revenue segmentation:-
In Q2FY25, Siemens India, the Energy segment contributed around 31.55 percent, Smart Infrastructure contributed around 34.50 percent, Mobility by 13.41 percent, Digital Industries by 15.98 percent, Portfolio Companies (Low Voltage Motors Business is considered under this segment) contributed around 3.91 percent and the remaining 0.58 percent.
Company profile:-
Siemens India, a subsidiary of Siemens AG while specializes in technology solutions across industries while focusing on automation, digitalization, healthcare, and infrastructure, with a commitment towards sustainable innovation and smart cities.
Written by Santhosh S.
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