Add Siemens, target price Rs 1202: ICICI Securities

ICICI Securities has given add rating to Siemens with a target price of Rs 1202. The share price moved down by 0.22 per cent from its previous close of Rs 1158. The stock’s last traded price is Rs 1155.50.

Siemens Ltd., incorporated in the year 1957, is a Large Cap company (having a market cap of Rs 41096.28 Crore) operating in Engineering sector.

For the quarter ended 30-06-2020, the company reported a Consolidated sales of Rs 1276.00 Crore, down 53.72 % from last quarter Sales of Rs 2756.90 Crore and down 59.21 % from last year same quarter Sales of Rs 3128.10 Crore. The Company reported net profit after tax of Rs -1.90 Crore in latest quarter.


Investment Rationale
There persists a challenging outlook in terms of slowdown of capex-related ordering and execution. Slowdown in automotive segments is impacting the overall growth under automation. However, the company has strong balance sheet with net cash of Rs45bn and diversified growth levers. Given slowdown and weak execution, the brokerage downgrades the stock to ADD from BUY with a revised target price of Rs1,202 (previously: Rs1,277). Focus on margins, predictable cashflows from digitisation and short-cycle demand is expected to support medium- to long-term growth.

Promoter/FII Holdings
Promoters held 75 per cent stake in the company as of June 30, 2020, while FIIs held 4.2 per cent, DIIs 10.1 per cent and public and others 10.7 per cent.

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