Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Siemens -------------------------------------------------------------------------------- Maintain NEUTRAL
Modest PAT growth in 1Q; Rich valuations cap upside
● Siemens reported PAT growth of 3% YoY in this quarter despite a
38% growth in sales due to a sharp decline in margins. Given high
base of margins and an order book growth of 9% YoY, we believe
achieving consensus earnings growth est. of over 20% this year
may be challenging.
● While in Dec quarter last year management had not attributed the
margin increase to exceptional items, the current press release
highlights that Dec-09 had Rs760 mn worth of exceptional gains
from some projects. Since these are operational gains we see no
reason to adjust the base while calculating PAT growth.
● Order inflows declined 25% YoY due to high base (Qatar order
win in Dec-09). Siemens included a portion of the Torrent power
order in this quarter (~40% of the order worth Rs55 bn booked by
Siemens Ltd. – assuming base orders in 1Q were ~Rs20 bn).
● While we prefer Siemens relative to ABB/Areva T&D we believe
that, given limited scope for EPS upgrades and rich valuations
(28x Sep-11E), a case for sustained outperformance appears low,
in our view. We maintain our NEUTRAL rating.
India Equity Research Reports, IPO and Stock News Visit http://indiaer.blogspot.com/ for complete details �� ��
Siemens -------------------------------------------------------------------------------- Maintain NEUTRAL
Modest PAT growth in 1Q; Rich valuations cap upside
● Siemens reported PAT growth of 3% YoY in this quarter despite a
38% growth in sales due to a sharp decline in margins. Given high
base of margins and an order book growth of 9% YoY, we believe
achieving consensus earnings growth est. of over 20% this year
may be challenging.
● While in Dec quarter last year management had not attributed the
margin increase to exceptional items, the current press release
highlights that Dec-09 had Rs760 mn worth of exceptional gains
from some projects. Since these are operational gains we see no
reason to adjust the base while calculating PAT growth.
● Order inflows declined 25% YoY due to high base (Qatar order
win in Dec-09). Siemens included a portion of the Torrent power
order in this quarter (~40% of the order worth Rs55 bn booked by
Siemens Ltd. – assuming base orders in 1Q were ~Rs20 bn).
● While we prefer Siemens relative to ABB/Areva T&D we believe
that, given limited scope for EPS upgrades and rich valuations
(28x Sep-11E), a case for sustained outperformance appears low,
in our view. We maintain our NEUTRAL rating.
No comments:
Post a Comment