Hold ABB India; target of Rs 4850: ICICI Securities

ICICI Securities research report on ABB India

ABB India (ABB) reported disappointing numbers in Q2CY25 on both ordering and financial fronts. While the orderbook (OB) was healthy at INR 100.6bn as of Jun’25 (book-to-bill of 0.8), order inflow (OI) fell 12% YoY. The decline was due to dip in large orders, while base orders were up 5% YoY. ABB attributed the dip to sluggish domestic demand as private capex was delayed due to macro uncertainties. ABB also reported margin contraction in Q2, partly due to lower gross margin (higher import content), a one-off cost, forex losses, and adverse revenue mix. EBITDA margin was down ~610bps YoY, dragging the EBITDA/PAT to INR 4.1bn/ 3.5bn (-24%/-20% YoY).

Outlook

We expect near-term outlook to be slightly negative in terms of both OI and profitability; green shoots in OI especially large orders, is a key monitorable. Maintain HOLD with a revised TP of INR 4,850, valuing the stock at 50x CY26E earnings.