Stock Of The Day: ABB India—Analyst Views, Key Levels To Watch
The research firm maintains a 'buy' rating on the stock, with an increased target price of Rs 7,550 apiece.
ABB India Ltd. has plenty of scope to scale up its new order growth across mobility-led positioning and low, medium-voltage electrification product expansion, which augurs well for margins, according to UBS Research.
The research firm maintains a 'buy' rating on the stock, with an increased target price of Rs 7,550 apiece from Rs 5,380 earlier, implying a potential upside of 21%.
The consensus margin forecast for ABB has already been raised 210 basis points for 2024 in the past 12 months, along with a 3% upgrade in new order intake, UBS said. "We think there is ample scope for ABB to deliver on profitability, led by low/medium-voltage electrification and motion, both of which are enjoying strong demand, with ABB sharpening its focus on product range expansion and availability."
Shares of the company jumped as much as 6.9% during the day to a record high of Rs 6,341 apiece.
Key Levels To Watch
Key support: Rs 4,343.75 apiece (three-week low).
Resistance level: Rs 6,319.55 apiece.
Business Background
ABB is an integrated power equipment manufacturer supplying a range of engineering, products, solutions and services in areas of automation and power technology.
The company has divided its operations in four major segments.
Electrification: Offerings include distribution solutions, smart power, smart building installation products, power conversion services.
Motion: A complete range of electrical motors, generators, drives and services, as well as integrated digital powertrain solutions.
Process Automation: Includes industry-specific integrated automation, electrification and digital solutions, control technologies, software and advanced services.
Robotics and discrete automation.
The company derives 90% of its revenue through domestic business, while the rest 10% contribution comes from exports.
Segment Mix: Orders Received in Q4CY2023
Q4CY23 Highlights (Consolidated, YoY)
Revenue up 14% at Rs 2,757.5 crore vs Rs 2,426.9 crore.
Ebitda up 15% at Rs 417.2 crore vs Rs 364.3 crore.
Margin expands 12 basis points at 15.13% vs 15.01%.
Net profit up 11% at Rs 338.7 crore vs Rs 305.3 crore.