Siemens Energy Drives Growth In Parent With 2.5 Times Q1 Profit Jump

Siemens Energy India Ltd., a wholly owned subsidiary of Siemens Ltd., saw its net profit more than double in the first quarter of financial year 2025. This was the first time the Indian parent entity reported financials of the unit.

The demerger of the energy business is currently awaiting NCLT clearance. The company will also be listed separately on exchanges if the demerger comes into effect. The process is anticipated to be completed in 2025.

Siemens follows the October-September cycle. It reported its fist quarter results on Wednesday. The company posted a 21.6% year-on-year rise in its consolidated net profit in the quarter ended Dec. 31, 2024, even as its revenue slipped during the period.

Siemens Energy India provides solutions across the entire energy value chain. The company offers products and services for power plants, including gas turbines, steam turbines and generators. It also has a presence in the High Voltage Direct Current segment, where the company manufacturers power transformers and builds substations.

Siemens Energy India was the parent company's major growth driver this quarter. While the revenue for the non-energy businesses fell 3% annually and 22% sequentially, the top line for the energy business was up 28% on a year-on-year basis.

The energy segment also saw its bottom line in the first quarter increase 2.5 times to Rs 243 crore. The segment's EBIT margins stood at 21.5%, which is a 1,060 basis point expansion from the same period a year ago.

Motilal Oswal Financial Services Ltd. and Nuvama Research remain very positive on the energy segment's growth prospects. In fiscal 2024, Siemens Energy India's top line stood at Rs 6,345 crore, with an Ebit margin of 14.3%.

Nuvama Research expects the business' revenues to grow 32% YoY in FY25, with Ebit margins being maintained at 14%.

Motilal Oswal expects the business' revenue to grow 13% in FY25, and expects the Ebit margins to improve to 16%.