This Multibagger Engineering Stock Jumped 8.19% In 1 Week, Buy For High Returns, Says ICICI Direct

Leading brokerage firm ICICI Direct assigns a "buy" call to Siemens Ltd., a large-cap engineering sector company, with a target price of Rs 3,630 per share for decent gains of up to 22% if the stock is purchased at the current market price. It has a market capitalization of Rs 1,06,485 crore.

Siemens is a leader in technology solutions for smart, intelligent, building technologies, mobility, digital industries and power T&D. It operates mainly in five key segments including energy/gas & power (34%), smart infrastructure (33%), digital industries (22%), mobility (7%). Well placed to gain from the overall energy market transformation from electrification to automation and digitisation.

CMP, 52-Week Low/High, & Returns Over the Years

The current market price (CMP) of the Siemens' stock on NSE is Rs 2,990.15 per share, down 1.59% as compared to its previous close. The stock recorded its 52-week high level on 15 September 2022 at Rs 3,138.50, whereas, its 52-week low level was recorded on 9 May 2022 at Rs 2,150.10, respectively. 

The stock in the last 1 week surged by 8.19%, whereas, in the last 1 month, it surged by 2.5%. In the last 1year, it surged by 19.26%. In the last 3 years, it has given 101.48% multibagger returns. In 5 years, it has given 161.35% multibagger returns to shareholders. 

Q4FY22 Results

Siemens reported a decent set of Q4FY22* numbers. Consolidated revenue was at Rs 4657.1 crore, up 8.4% YoY. EBITDA came in at Rs 516 crore with margins of 11.1%, supported by stable gross margins. Consequently, PAT came in at Rs 652.3 crore, up 102.8%. Order inflow for Q4FY22 was decent at ~Rs 4009 crore, up 25% YoY. 

Buy for a target price of Rs 3,630/share

Overall, further penetration of automation & digitisation products and services across segments to drive long term growth. "We remain long term positive and retain our BUY rating on the stock. We value Siemens at Rs 3630 on an SoTP basis," the brokerage has said. 

Key triggers for future price performance

• Strong focus on technology leadership in digitisation and automation products to further strengthen its market share.
• Strong demand for short cycle products with clear traction from steel, cement, chemical, pharma, fertiliser industries to drive strong growth and margin expansion in smart infrastructure and digital industries segments.
• Expect revenue, EBITDA to grow at a CAGR of ~18%, 18.6%, respectively, in FY22-24E owing to strong traction in short cycle products and services.

Disclaimer

The stock has been picked from the brokerage report of ICICI Direct. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.