Buy Siemens, target price Rs 8,000: Motilal Oswal Financial Services

Motilal Oswal Financial Services has a buy call on Siemens with a target price of Rs 8,000. The current market price of Siemens Ltd. is Rs 6831.15. Siemens, incorporated in 1957, is a Large Cap company with a market cap of Rs 242900.89 crore, operating in Engineering sector.

Siemens' key products/revenue segments include Engineering Goods, Income from Project Development, Sale of services, Other Operating Revenue, Export Incentives, Rental Income and Commission for the year ending 30-Sep-2023.

Financials

For the quarter ended 30-09-2024, the company has reported a Consolidated Total Income of Rs 6744.40 crore, up 25.82% from last quarter Total Income of Rs 5360.30 crore and up 13.29% from last year same quarter Total Income of Rs 5953.20 crore. The company has reported net profit after tax of Rs 831.20 crore in the latest quarter.

The company's top management includes Mr.Deepak S Parekh, Mr.Shyamak Ramyar Tata, Mr.Juergen Michael Wagner, Mr.Anami N Roy, Mr.Deepak S Parekh, Mr.Sunil Mathur, Mr.Daniel Spindler, Mr.Tim Holt, Mr.Matthias Rebellius, Ms.Sindhu Gangadharan, Mr.Shyamak Ramyar Tata, Mr.Juergen Michael Wagner, Ms.Sindhu Gangadharan, Mr.Matthias Rebellius, Mr.Tim Holt, Mr.Sunil Mathur, Mr.Daniel Spindler, Mr.Tim Holt, Mr.Matthias Rebellius, Ms.Sindhu Gangadharan, Mr.Shyamak Ramyar Tata, Mr.Juergen Michael Wagner, Mr.Anami N Roy, Mr.Deepak S Parekh, Mr.Sunil Mathur, Mr.Daniel Spindler, Mr.Anami N Roy. Company has B S R & Co. LLP as its auditors. As on 30-09-2024, the company has a total of 36 Crore shares outstanding.

Investment Rationale
Motilal Oswal Financial Services has slightly lowered their margin estimates to bake in FY24 performance and expect Siemens to clock a CAGR of 19%/22%/20% in revenue/EBITDA/PAT over FY24-27E. The stock is currently trading at a P/E of 81x/64x/52x on FY25E/FY26E/FY27E. The brokerage expects SIEM to benefit from expected revival in private capex, railways and higher exports as SIEM emerges as a manufacturing hub for the parent for exports going forward. They value the stock at 70x two-year forward EPS and maintain their BUY rating with a revised target price of Rs 8,000 (Rs 8,500 earlier).

Promoter/FII Holdings
Promoters held 75 per cent stake in the company as of 30-Sep-2024, while FIIs owned 8.69 per cent, DIIs 6.83 per cent.