Hold ABB; target of Rs 1506: Nalanda Securities

Nalanda Securities' research report on ABB

ABB ltd (ABB) posted Q1CY19 revenue at INR 1850 up 18% Y-o-Y and down 6% Q-o-Q. EBITDA stood at INR 145 crore up 63% Y-o-Y and down 33% Q-o-Q. PAT stood at INR 116 crore up 14% Y-o-Y and down 41% Q-o-Q. EBITDA Margin during the quarter stood at 8% vs 11% QoQ and 6% YoY. PAT Margin during the quarter stood at 6% vs 10% QoQ and 7% YoY.

Outlook

At CMP of INR 1453.5, the company is trading at 44x CY20E EV/ EBITDA and 48x CY20E EPS. We value the company using average of EV/ EBITDA and P.E. multiple methodology. We have given an exit multiple of 45x for EV/EBITDA and 50x for PE to arrive at an average target price of INR 1506 which is an upside of 4%.

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