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Siemens Q1 Review: Margin Weakness Persists; Motilal Oswal Cuts FY27 Estimates — Check New Target Price

The capital goods major's margins across segments were impacted by commodity and currency fluctuations, especially in smart infrastructure, as a larger part of the order book is short cycle in nature, adds the brokerage.

Siemens Q1 Review: Margin Weakness Persists; Motilal Oswal Cuts FY27 Estimates — Check New Target Price
Siemens's revenue grew 15% YoY to Rs 4,700 crore, broadly in line with Motilal Oswal's expectations,
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Siemens Ltd.
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NDTV Profit's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer NDTV Profit's subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Motilal Oswal Report

Siemens India Ltd. shares are likely to remain in focus after Motilal Oswal Financial Services retained its Neutral rating on the capital goods major and revised its target price to Rs 3,600 from Rs 3,500, citing persistent margin pressure despite healthy order inflows and a robust order book.

The revised target price implies a downside of around 10% from the current market price of Rs 4,011.

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The brokerage described Siemens' June-quarter performance as mixed. Revenue grew 15% YoY to Rs 4,700 crore, broadly in line with expectations, supported by broad-based growth across Smart Infrastructure, Mobility and Digital Industries. However, profitability fell short of estimates as margins came under pressure from commodity-price volatility, currency fluctuations and higher material costs.

Ebitda declined 17% YoY to RS 430 crore, while Ebitda margin contracted 350 basis points to 9.1%. Adjusted profit after tax (PAT) also fell 17% YoY to Rs 350 crore, missing brokerage estimates due to weaker-than-expected margins, particularly in the Smart Infrastructure segment.

Order inflow increased by 16.5% to Rs 6,330 crore, taking the overall order book to Rs 46,700 crore, up 10% YoY. Order inflow growth was driven by automation orders across sectors, orders from grid modernisation, data center, commercial real estate and rolling stock.

Click on the attachment to read the full report:

Mosl Siemens Q1.pdf
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