Buy ABB India, target price Rs 961: Yes Securities

Yes Securities has given a buy rating to ABB India with a target price of Rs 961. The share price moved down by 3.12 per cent from its previous close of Rs 936.50. The stock’s last traded price is Rs 907.25.

ABB India Ltd., incorporated in the year 1949, is a Large Cap company (having a market cap of Rs 19251.88 Crore) operating in Engineering sector.

Financials
For the quarter ended 30-09-2019, the company reported a Consolidated sales of Rs 1723.76 Crore, up .89 % from last quarter Sales of Rs 1708.58 Crore and unchanged .00 % from last year same quarter Sales. The company reported net profit after tax of Rs 135.28 Crore in latest quarter.


Investment Rationale
The brokerage said that the Stock is currently trading at 47x CY21E earnings and it has a ‘BUY’ rating with TP of Rs 961 at 45x on Mar’22 earnings.

The brokerage further said that ABB, given its niche business related to products and services and a pure play on Digitalization and Automation is a good pick. Postponement of major capex to subsequent quarters due to COVID-19 has led to greater focus on plant upkeep, optimization, automation & digital solutions which should augur well for ABB.

Its focus will remain on the sectors like F&B, data centers, pharmaceuticals, energy, chemicals, and railways & metros, which are likely to demonstrate selective shoots of growth, will be critical.