JP Morgan puts 'Neutral' rating on Siemens India
Siemens India’s standalone September quarter profit of Rs 152 crore was down 33% y-o-y , well below Street expectations. Weak topline growth and a 270 bps margin decline led to disappointing bottomline performance .
By ET Bureau |
RESEARCH:JP MORGAN
RATING: NEUTRAL
CMP: RS 519
Siemens India’s standalone September quarter profit of Rs 152 crore was down 33% y-o-y , well below Street expectations. Weak topline growth and a 270 bps margin decline led to disappointing bottomline performance .
Order inflows in FY09 rose marginally to Rs 880 crore, and order book was Rs 10,290 crore, providing visibility for the next year. Degrowth in T&D revenues led to weak execution in the September quarter . The energy segment revenues fell on account of weakness in the transmission (-24 %) and distribution (-3 %) businesses, indicating severe pricing and volume pressures in T&D due to competition.
Siemens has raised its stake in Siemens Building Technology Private (SBTPL) by 6.83% to 86.15%. However the consideration of Rs 79.1 crore values the subsidiary at Rs 1,158 crore, 127x FY08 profit of SBTPL (Rs 9.1 crore). The company has also approved the acquisition of the remaining 13.8% stake for Rs 70.2 crore. Siemens also announced the acquisition of the remaining 50% stake in Flender for Rs 91 crore, effective August ‘09. Prima facie in FY09, it appears that subsidiaries have reported a loss of Rs 70 crore (consolidated less standalone PAT).
RATING: NEUTRAL
CMP: RS 519
Siemens India’s standalone September quarter profit of Rs 152 crore was down 33% y-o-y , well below Street expectations. Weak topline growth and a 270 bps margin decline led to disappointing bottomline performance .
Order inflows in FY09 rose marginally to Rs 880 crore, and order book was Rs 10,290 crore, providing visibility for the next year. Degrowth in T&D revenues led to weak execution in the September quarter . The energy segment revenues fell on account of weakness in the transmission (-24 %) and distribution (-3 %) businesses, indicating severe pricing and volume pressures in T&D due to competition.
Siemens has raised its stake in Siemens Building Technology Private (SBTPL) by 6.83% to 86.15%. However the consideration of Rs 79.1 crore values the subsidiary at Rs 1,158 crore, 127x FY08 profit of SBTPL (Rs 9.1 crore). The company has also approved the acquisition of the remaining 13.8% stake for Rs 70.2 crore. Siemens also announced the acquisition of the remaining 50% stake in Flender for Rs 91 crore, effective August ‘09. Prima facie in FY09, it appears that subsidiaries have reported a loss of Rs 70 crore (consolidated less standalone PAT).
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