Siemens Energy India has received ‘Buy’ ratings from at least two brokerages — Jefferies and MOFSL, following the company’s maiden quarterly earnings, following its demerger from Siemens Ltd.
Siemens Energy India Ltd reported a 36.34 per cent year-on-year rise in net profit at Rs 246.10 crore for the March 2025 quarter, mainly driven by income from its power transmission and generation segments.The company, which follows an October-September financial year, had posted a profit of Rs 180.50 crore in the same quarter last year. Total income for the March quarter rose to Rs 1,893.9 crore from Rs 1,196.8 crore a year ago.
MOFSL said Siemens Energy India’s results for Q2 and the 1HFY25 were better than its estimates. The comparable numbers for the previous period are not available, ir said adding that revenue growth improved 24 per cent QoQ and Ebitda margin stood strong at 19.1 per cent for the quarter, driven by strong margins in the power transmission segment.
“Margins were soft in the power generation segment. Ebitda margin has been continuously improving for the company for the past two quarters even after adjusting one-off items. Based on 1HFY25 performance, we raise our estimates by 13 per cent/6 per cent/8 per cent for FY25/FY26/FY27 to bake in improved execution and margin in the power transmission segment,” it said.
The brokerage believes Siemens Energy India to continue to benefit from a strong addressable market in T&D as well as its planned capacity expansion in the transmission segment.
“Accordingly, we estimate a CAGR of 27 per cent/29 per cent in revenue/PAT over FY25-27. Retain BUY with a revised target of Rs 3,300 (from Rs 3,000), based on 60x Sep’27E EPS,” it said.
Jefferies has maintained its ‘Buy’ rating and a target price of Rs 3,500, saying it is a power capex play with margin upside ahead. The stock settled at Rs 3,000.05 on Monday. The target prices on the counter suggests up to 17 per cent potential upside.
“Our Rs 3,500 PT values SE at 65 times PE Mar-27E, which is a 5% discount to Hitachi Energy. Hitachi and GE Vernova T&D are comparable to SE and are trading at 68x and 55x PE Mar-27E. GE has seen 78% YoY export order flow growth in FY25, which is a key driver ahead, unlike for SE. Exports have come into question given US President Trump’s tariff policy uncertainty. Downside risks: 1) Fixed costs rise in line with / faster than revenue growth; and 2) Weak power demand slowing power capex,” Jefferies said.
MOFSL said its assumptions for revenue growth take into account doubling of capacity for transformers and expansion in GIS, along with normal business growth for turbine business. Key risks to its thesis can come from a slowdown in ordering and supply chain issues impacting margin, the domestic brokerage said.