Accumulate Siemens; target of Rs 4254: Prabhudas Lilladher

Prabhudas Lilladher's research report on Siemens

We revise our SY24E/SY25E EPS estimates upwards by 11.9%/14.1%, owing to a strong outlook on order inflows and benefits of operating leverage. Siemens (SIEM) reported strong quarterly performance with consolidated revenue up ~27.8% YoY. EBITDA margin expanded 44bps YoY, owing to lower other expenses. We believe that strong traction is likely to continue in high growth verticals such as data centers, railways, chemicals & pharma, e-mobility, waste heat recovery, smart infra, intralogistics, building automation, decarbonization etc. Furthermore, the large order win in railways for 1,200 electric locomotives (9000 HP) worth ~Rs255bn (including operations & maintenance) will act as a sustainable long-term revenue contributor. We remain positive on SIEM from a long-term perspective given 1) its strong and diversified presence across industries through focus on electrification, digitization & automation products, 2) product localization, 3) strong balance sheet, 4) healthy public & private capex, 5) focus on cost efficiencies and 6) recent large order wins in mobility business.

Outlook

We maintain ‘Accumulate’ rating on the stock with revised TP of Rs4,254 (Rs3,351 earlier), valuing it at 57X Sep’25, (55x Mar’25 earlier), given robust sustained performance.

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