Hold Siemens Energy India: target of Rs 3125: ICICI Securities

ICICI Securities's research report on Siemens Energy India

Siemens Energy India (SEI) is operating in one of the best plays in energy transition – the ongoing grid expansion. It is amongst the leading players providing transmission equipment. India’s transmission story is pacing well; FY25 saw transmission project awards worth INR 1.6trn in the bids. We expect the bidding activity to be strong at >INR 1trn/annum over the next 3 years; large transmission capex bodes well for SEI. It also has a generation portfolio – gas/steam turbines, O&M and other services; we expect the segment to grow at a steady rate of ~10% in medium term. SEI also caters to part of Siemens Energy Global’s orderbook, adding another growth dimension. Its order outlook remains positive; SEI’s order inflow was healthy in 9MFY25 at ~INR 108bn. We estimate its orderbook at INR 156bn as of Jun’25 (healthy book-to-bill of ~2.3x). However, given the recent run up in the stock price post its listing in Jun’25, we downgrade it to HOLD from Add.

Outlook

We downgrade the stock to HOLD from Add with a revised target price of INR 3,125 (INR 2,900 earlier), valuing the stock at 65x FY27E earnings.