At a Glance (Excerpt Only)
Siemens India is a rock-solid automation and energy infra player with deep moats, German parentage, and zero debt. But after the demerger of Siemens Energy and a 27% stock correction from highs, investors are asking: is it a value buy or still über-expensive?
🧾 1. Financial Recap (FY21–FY25)
| Metric | FY21 | FY22 | FY23 | FY24 | FY25* | 5Y CAGR |
|---|---|---|---|---|---|---|
| Revenue (₹ Cr) | 13,198 | 16,138 | 19,554 | 22,240 | 17,507 | 11% |
| Net Profit (₹ Cr) | 1,089 | 1,543 | 1,962 | 2,718 | 2,606 | 19% |
| Operating Profit (₹ Cr) | 1,452 | 1,860 | 2,487 | 3,104 | 2,105 | 18% |
| OPM (%) | 11% | 12% | 13% | 14% | 12% | Steady |
| EPS (₹) | 30.6 | 43.3 | 55.1 | 76.3 | 73.1 | 🚀 |
| ROCE (%) | 14% | 16% | 21% | 24% | 23.6% | 📈 Strong |
🧠 Note: FY25 sales dipped post Siemens Energy India demerger. But profit stayed strong. This is lean, clean cap goods execution.
🛠️ 2. What Siemens Actually Does
Think of it as India’s most sophisticated wiring technician with German precision. Business lines:
- ⚡ Grid Automation & Power Distribution
- 🏭 Smart Factories (Digital Industries)
- 🚄 Mobility (High-Speed Rail, Metros)
- 🏢 Smart Infra for buildings and cities
- 🔌 EV Charging Infra (Emerging)
📡 Recent Highlight: ₹1,230 Cr order for India’s first High-Speed Rail (bullet train project)
🧨 3. What’s Not So Perfect?
- 🧾 Valuation Still Elevated: P/E ~60x even after correction from ₹4,600 to ₹3,150
- 🧾 Low Dividend Yield: 0.38% — classic MNC style, love you but won’t pay you
- 🧮 Other Income Inflation: FY24 profit includes ₹1,442 Cr from “other income” — needs adjustment for true earnings
- 🏗️ Infra Cycle Dependent: Growth linked to government and private capex moods
🧮 4. Adjusted Valuation – EduInvesting Style
Let’s filter out that one-off other income and do proper maths:
- FY25 Adj. EPS (Ex-Other Income Boost): ~₹55–60
- Fair PE Range: 35–45× for stable, capex-linked monopolistic player
📉 Fair Value Range = ₹1,925 – ₹2,700
📌 CMP = ₹3,149
🚨 Siemens is still 15–30% overvalued, even after a 27% correction from peak.
🏗️ 5. Peer Comparison
| Company | P/E | ROCE (%) | OPM (%) | PAT (₹ Cr) | Sales (₹ Cr) |
|---|---|---|---|---|---|
| Siemens | 59.7 | 23.6 | 12.0 | 2,606 | 17,507 |
| ABB India | 66.9 | 38.7 | 18.9 | 1,889 | 12,267 |
| CG Power | 106.3 | 38.1 | 13.2 | 973 | 9,908 |
| BHEL | 170.8 | 4.5 | 4.4 | 534 | 28,339 |
🧠 Context: Capital goods sector is in a bubble. Siemens is less overpriced than BHEL or CG, but still nowhere near cheap.
🔌 6. Hidden Strengths
✅ Zero Debt
✅ 75% German Ownership (Siemens AG)
✅ 10-year RoE above 13%
✅ Excellent FII inflow (from 5.4% to 8.2% in 2 years)
✅ World-class execution in Indian projects
💡 Bonus: Siemens India often gets the first look at projects from Germany’s global infra/EV/AI R&D pipeline.
🤔 7. Final Verdict:
This is not a multibagger. It’s a wealth preserver.
🟢 Great company, clear moat, superb global parent
🔴 But the price assumes 20%+ profit growth for 5 more years — already baked in
🟡 You don’t buy Siemens to get rich, you buy it to stay rich
Wait for ₹2,500-₹2,700 levels for long-term compounding. Or just admire from a distance like a luxury German sedan showroom.
✍️ Written by Prashant | 📅 June 26, 2025
Tags: Siemens India, high-speed rail, capital goods, Siemens Energy demerger, undervalued largecaps, industrial automation, EduInvesting
