Buy Siemens, target price Rs 7,500: Motilal Oswal
Buy Siemens : Motilal Oswal Financial Services has issued a buy recommendation for Siemens, setting a target price of Rs 7,500. Currently, Siemens Ltd. is trading at Rs 5942.75. Established in 1957, Siemens is a Large Cap company with a market capitalization of Rs 208,560.19 crore, operating in the Engineering sector.
Siemens Ltd.’s primary Products/Revenue Segments include Engineering Goods, Income from Project Development, Sale of services, Other Operating Revenue, Export Incentives, Rental Income, and Commission for the year ending 30-Sep-2023.
Financially, for the quarter ended 30-09-2024, the company reported a Consolidated Total Income of Rs 6,744.40 crore, a 25.82% increase from the previous quarter’s Total Income of Rs 5,360.30 crore, and a 13.29% increase from the same quarter last year, totaling Rs 5,953.20 crore. The company also reported a net profit after tax of Rs 831.20 Crore in the latest quarter.
The company’s top management team includes Mr. Deepak S Parekh, Mr. Shyamak Ramyar Tata, Mr. Juergen Michael Wagner, Mr. Anami N Roy, Mr. Sunil Mathur, Mr. Daniel Spindler, Mr. Tim Holt, Mr. Matthias Rebellius, and Ms. Sindhu Gangadharan. B S R & Co. LLP serves as the company’s auditors. As of 31-12-2024, the company has a total of 36 crore shares outstanding.
Investment Analysis
The current P/E ratios for Siemens stock are 72x/58x/47x for FY25E/FY26E/FY27E. Motilal Oswal Financial Services has adjusted their estimates by 3%/4%/5% for FY25/26/27 due to a slower growth in digital industries and mobility segment inflows. They anticipate a weak near-term order inflow for non-energy segments, attributed to a slower private capex growth. However, with an expected increase in government capex and a focus on exports, Siemens (SIEM) is poised to become a manufacturing hub for its parent company in the export market.
Motilal Oswal has revised their valuation multiple from 70x to 65x on a two-year forward earnings basis to reflect the slower inflow growth. Despite this adjustment, they maintain a BUY rating on the stock with a revised target price of Rs 7,500 (previously Rs 8,000).
Promoter/FII Holdings
As of December 31, 2024, promoters held a 75% stake in the company, while FIIs owned 8.77% and DIIs held 6.73%.
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.