Target: ₹4,241

CMP: ₹3,600.25

We attended Siemens India’s Innovation Day, where the management emphasized on digitalization and decarbonization as an emerging theme playing major role in the upcoming capex across sectors such as industries, power grids, mobility, buildings, data centers etc. India has a huge potential to adopt digitalisation in manufacturing processes backed with government emphasis on increasing share of manufacturing in GDP from 15 to 25 per cent over next 5 years and likely revival in private capex with capacity utilisation levels reaching about 75 per cent.

Siemens sees opportunities arising though current trends such as public capex, private capex and focus on decarbonisation.

We remain positive on SIEM from a long-term perspective given strong and diversified presence across industries through focus on electrification, digitisation & automation products, product localisation, strong balance sheet, healthy public & private capex and focus on cost efficiencies. The stock is currently trading at PE of 65.6x/59.7x/50.3x SY23/24/25.

We maintain ‘Accumulate’ rating on stock with TP of ₹4,241 (same as earlier), valuing it at PE of 60x SY25E.