SIEMENS LTD - Moneycontrol.comchats.moneycontrol.com/plus/upload_pdf_file/SIEMENS_HEM.pdf · 2019-01-07 · SIEMENS LTD Stock Coverage For Private Circulation Only HEM RESEARCH Date

BROKING | DEPOSITORY | DISTRIBUTION | FINANCIAL ADVISORY|MERCHANT BANKING

SIEMENS LTD

Stock Coverage

www.hemsecurities.com

For Private Circulation Only HEM RESEARCH

Date 04th Jan 2019

BSE Code 500550

NSE Code SIEMENS

Market Cap (Rs Cr) 37910.78

52 week High/Low 1330/841

Industry Heavy Electrical

Equipment

Face Value Rs 2/Share

Shares O/S (In No) 35.61 Cr

EPS * 25.31

Book Value* 215.96

P/E 42.07

P/B 4.93

*Note: On FY’18 basis

Shareholding Pattern as on Sept’ 2018

Research Analyst : Astha Jain

With a focus on electrification, automation and digitalization, Siemens India stands for engineering excellence, innovation, and reliability. As one of the world’s biggest producers of energy-efficient, resource-saving technologies, Siemens is a pioneer in infrastructure and energy solutions, as well as automation and software for industry. The company is also a leader in medical imaging equipment, laboratory diagnostics, and clinical IT. Siemens also provides business-to-business financial solutions, rail automation and wind power solutions Siemens has 22 factories located across India, 8 Centers of Competence and 11 R&D Centers and a nation-wide sales and service network. The factories manufacture Steam Turbines, Switchgear, Remote Monitoring Systems (RMS), Motors and Generators, Relays and Smart Grid Systems, Transformers, Railway Bogies and X-ray Machines. These have been set up replicating global, best-in-class manufacturing systems and practices.

In Q4FY18 i.e Sept’18 company has reported surge of 25% in topline at Rs 3939.20 Cr as against Rs 3141.80 Cr in Q4FY17. Operating profit of company has reported rise of decent 32% at Rs 418.60 Cr as against Rs 317.20 Cr in Q4FY17. Company’s bottomline as shown rise of more than whopping 300% at Rs 279.20 Cr in Q4FY18 against Q4FY17 (calculated excluding Exceptional Income of Rs 560.30 Cr in Q4FY17). For the fourth quarter of Financial Year Sept’2018, new orders grew by 38.1% to Rs. 3,720 crore compared to Rs. 2,694 crore in the fourth quarter of Financial Year 2017. New Orders for the Financial Year 2018 were Rs. 12,740 crore. The order backlog as of September 30, 2018 stood at Rs. 12,352 crore.. Order inflows in company’s base business continue to grow, its profitability and cash from operations is strong and company’s digitalization agenda continues to gather momentum. Company is continuously driving on strong sectoral outlook. Demand for captive power plants is growing in fertilizer, sugar etc Also, replacement of ageing / inefficient power plants with super critical technology expected in the medium term which is positive for company. Capital expenditure is seen to be growing in some segments like automotive, pharmaceuticals, food & beverage. Along with above, strong interest in digitalization solutions for energy efficiency, enhanced productivity and flexibility will benefit company in long term.

Valuation

The company is currently trading at 42.07 of TTM eps of Rs 25.31 while it is trading at 35x of FY19E eps & 32x of FY20E eps. As private Capex picks up and more of company’s customers see real benefits in implementing digitalization, company will continue to benefit from that. Along with it, robust financial performance by company in year ending Sept’18 with healthy balance sheet makes a case for buy in stock with price target of Rs 1280 for long term horizon.

BUY CMP 1064.55 TARGET 1280.00 LONG TERM INVESTMENT

Promoter75%

FII 5%

Others20%

SIEMENS LTD



Business Segments Digital Factory Division offers software products and automation technologies for industrial applications covering the entire life cycle, from product design and production to after-sales service for discrete manufacturing industries such as automotive, F&B. Company offer products and solutions viz Automation system; Industrial control; Industrial communication; LV and MV Drives; Geared motors; Motion control; CNC solutions; Low voltage switchgear for switching, protection and control; PLM software and services Process Industries and Drives Division offers a comprehensive portfolio for industrial application and solutions in the field of automation and drives for process industries such as cement and steel. Company offer products and solutions viz Process automation; Integrated Drive Systems (IDS); Sensor systems; Plant engineering software; LV motors (upto frame size 560); MV motors (upto frame size 630); Traction motors; Mechanical drives; Windmill generators (≤ 1875 MW); Gear boxes Building Technologies Division provides solutions for safe, secure and energy-efficient infrastructure and buildings. Company offer products and solutions viz Building automation systems; HVAC products; Building control; Security systems; Fire safety systems; Energy efficiency systems ; Total Building Solutions ; Integrated systems and solutions for specific markets and industries such as data centers, utilities, airports, hospitals and hotels. Power and Gas Division offers products and solutions for reliable, efficient and clean power generation from fossil fuels and for oil & gas applications. Company offer products and solutions like Gas turbines (≤ 400 MW); Steam turbines (≤ 1900 MW); Generators (≤ 2235 MVA) ; Condensers ; Turbo compressors Instrumentation ,and control; Electrical balance of plant; Integrated power plant Solutions ; Energy solutions : Power block, Power island, complete lumpsum turnkey power plants on EPC basis. Energy Management Division is a supplier of products, solutions and services for the transmission and distribution of electrical energy. Company offer products and solutions viz Power transformers (≤750 MVA); Shunt reactors (≤ 125 MVAr); Protection relays and devices; AIS upto 800 kV; GIS upto 800 Kv ; Circuit breakers (≤ 800 kV); Disconnectors (≤ 765 kV); Instrument transformers; Control and relay panel (≤ 765 kV) ; LV /MV switchboards (≤ 40 kV). Mobility Division supplies solutions for passenger and freight transportation, including rail vehicles, rail automation and rail electrification systems. Company offers products and solutions like Propulsion systems ; Inverters ; Rail Signaling ; Rail electrification ; Rail automation ; Intelligent Traffic Management ; Light Rail; Metro Rail; Passenger coaches.

For Private Circulation Only HEM RESEARCH

\

0

5

10

15

20

Sales Profit fromoperations

Margin

14.2

2

14.214.8

2.5

16.6

Power & Gas (Rs Bn)

FY17 FY18

0

20

40

60


Margin

43.5

3.27.4

51.6

4.28.1

Energy Management (Rs Bn)

FY17 FY18

SIEMENS LTD



Robust Financial performance :

For the Financial Year 2018, Siemens Ltd. reported 14.6% increase in Revenue at Rs. 12,795.30 crore compared to Rs. 11403.40 crore for the Financial Year 2017. The Company’s Profit before exceptional items and tax increased by 26.3% to Rs. 1,391 crore for the Financial Year 2018 compared to Rs. 1,102 crore for the Financial Year 2017 (Profit from exceptional items before tax for the Financial year 2017 was Rs. 567 crore). Company’s operating profit margin increased by 12% at 10.37 % in FY18 as against 9.24% in FY17.For Q4FY18 company has reported surge of 25% in topline at Rs 3939.20 Cr as against Rs 3141.80 Cr in Q4FY17. Operating profit of company has reported rise of huge 32% at Rs 418.60 Cr as against Rs 317.20 Cr in Q4FY17. Company’s bottomline as shown rise of more than 300% at Rs 279.20 Cr in Q4FY18 against Q4FY17 (excluding Exceptional Item of Rs 560.30 Cr in Q4FY17),

Strong Sectoral Outlook

Company is continuously driving on strong sectoral outlook. Replacement of ageing / inefficient power plants with super critical technology expected in the medium term which is positive for company. Capital expenditure is seen to be growing in some segments like automotive, pharmaceuticals, food & beverage. Along with above, strong interest in digitalization solutions for energy efficiency, enhanced productivity and flexibility will benefit company in long term.

For Private Circulation only HEM RESEARCH

0

5

10

15

20

25


Margin

19.1

1.2

6.4

22.7

2

8.7

Digital Factory (Rs Bn)

FY17 FY18

0

5

10

15

20


Margin

17.2

0.5

3.1

19.2

0.8

4

Process Industries & Drives (Rs Bn)

FY17 FY18

0

2

4

6

8

10


Margin

4.2

0.3

6.8

4.9

0.4

9.1

Building Technologies (BT) (Rs Bn)

FY17 FY18

0

2

4

6

8

10

12


Margin

11.9

0.9

7.6

9.8

1

10.1

Mobility (Rs Bn)

FY17 FY18

SIEMENS LTD



Healthy Order Book For the fourth quarter of Financial Year 2018, new orders grew by 38.1% to Rs. 3,720 crore compared to Rs. 2,694 crore in the fourth quarter of Financial Year 2017. New Orders for the Financial Year 2018 were Rs. 12,740 crore. The order backlog as of September 30, 2018 stood at Rs. 12,352 crore.. Recently, the consortium of TRIL Urban Transport Private Limited (a Tata Group Company), and Siemens Project Ventures GmbH (subsidiary of Siemens Financial Services), has been awarded the contract by the Pune Metropolitan Region Development Authority to develop the metro corridor from Hinjewadi to Shivajinagar. The elevated metro line will originate from Hinjewadi Rajiv Gandhi Infotech Park, travel via Balewadi to Shivajinagar. The 23.3 kms corridor with 23 stations will be the first metro project in India on Public-Private-Partnership (PPP) model after the New Metro Rail Policy of 2017. The construction is scheduled to commence by June 2019 and completed within a time span of three years. Tata Projects will be the EPC partner supporting the consortium. Siemens has been partnering India for over 150 years in the areas of electrification and automation. It has been contributing to India's long-term growth story through its sustainable technologies, deep solution expertise, global project experience and strong local manufacturing presence. Siemens Financial Services (SFS) invests in infrastructure projects around the world, with great potential in India. Through PPPs, SFS is able to help cities meet their goals of obtaining intelligent infrastructure solutions and enable smarter, more sustainable transportation networks.

0

50

100

FY17 FY18

18.5 20.4

81.5 79.6

% Revenue Break Up

Export Domestic


0

50

100

FY17 FY18

26 29.8

74 70.2

Business Mix ( In %)

Government Non Government

0

50

100

FY17 FY18

18.5 20.4

81.5 79.6

% Revenue Break Up

Export Domestic

112114116118120122124126128

FY17 FY18

118.2

127.4Order (Rs Bn)

0

20

40

60

80

100

FY17 FY18

33.1% 36 %

66.9% 64%

Project Product System




SIEMENS LTD

Consolidated P&L A/c

Rs Cr

Particulars FY16 FY17 FY18 FY19E FY20E

Net Sales 10836.60 11064.70 12795.30 14714.60 15891.76 Growth ( %) ---- 2.10 15.64 15.00 8.00 Expenditure 9790.20 9986.20 11468.00 13169.56 14197.70 EBIDTA 1046.40 1078.50 1327.30 1545.03 1694.06 Growth (%) --- 3.07 23.07 16.40 9.65 EBIDTA Margin (%)

9.66 9.75 10.37 10.50 10.66

Other Income 164.20 253.20 280.10 322.12 347.88 Depreciation 227.60 197.80 197.70 227.36 245.54 EBIT 983.00 1133.90 1409.70 1639.80 1796.40 EBIT Margin (%) 9.07 10.25 11.02 11.14 11.30 Interest 37.10 32.30 8.20 8.20 8.20 Exceptional Item 2992.30 567.30 0.00 0.00 0.00 PBT 3938.20 1668.90 1401.50 1631.60 1788.20 Tax 1024.50 532.30 500.30 538.43 590.11 PAT 2913.70 1136.60 901.20 1093.17 1198.09 Min Int & Ass Sh 0.00 0.00 0.00 0.00 0.00 Consolidated PAT 2913.70 1136.60 901.20 1093.17 1198.09 Growth (%) --- (60.99) (20.71) 21.30 9.60 NPM (%) 26.89 10.27 7.04 7.43 7.54

Ratios


EPS 81.82 31.92 25.31 30.70 33.364

ROCE(%) 102.03 29.50 16.99 19.21 18.94

ROE(%) 42.83 14.78 10.86 12.81 12.63

Book Value 191.06 215.97 233.05 239.67 266.33

Debt/Equity 0.00 0.00 0.00 0.00 0.00



VIP INDUSTRIES LTD

Consolidated Balance Sheet

Rs Cr


Sh Capital 71.20 71.20 71.20 71.20 71.20

Res & Surplus 6732.50 7619.40 8227.70 8463.57 9412.66

Sh App/Warrants 0.00 0.00 0.00 0.00 0.00

Minority Interest 0.00 0.00 0.00 0.00 0.00

Total Debt(Long Term+Short Term Borrowings)

25.20 0.00 0.00 0.00 0.00

Other Long Term Liab & Provision

3842.62 3390.00 275.90 314.31 335.79

Net Deferred Tax Liability

-335.80 -248.20 -269.70 -269.70 -269.70

Sources Of Fund 10335.70 10832.40 8305.10 8579.38 9549.95

Net Fixed Assets 1306.20 1400.10 1311.30 1371.90 1431.79

Non –Current Investments

109.70 107.90 104.20 104.20 104.20

Intangible Assets 0.00 0.00 0.00 0.00 0.00

Other Non –Current Assets

4465.60 4226.00 1557.40 1791.01 1805.44

Total Current Assets 10219.50 12431.60 11093.70 12757.76 13778.38

Current Liabilities & Provisions

5765.30 7333.20 5761.50 7445.49 7569.88

Net Current Assets 4454.20 5098.40 5332.20 5312.27 6208.50

Uses Of Funds 10335.70 10832.40 8305.10 8579.38 9549.93




SIEMENS LTD

Standalone Quarterly Financial Highlights

Rs Cr Rs. Crore

Particulars Q4FY18 Q4FY17 Q3FY18 YoY% QoQ%

Total Income 3939.20 3141.80 3073.00 25.38 28.19

Total Expenses 3520.60 2824.60 2770.70 24.64 27.07

Operating Profit 418.60 317.20 302.30 31.97 38.47

Net Profit 279.20 623.80* 204.40 (55.24) 36.59

PBIDTM % 10.63 10.10 9.84 5.25 8.03

NPM % 7.09 19.85 6.65 (64.30) 6.62

EPS 7.84 17.52 5.74 (55.24) 36.59

*:Note:( PAT Includes Exceptional Income of Rs 560.30 Cr)

Past Price Movement


10 17 24 1

October

8 15 22 29 5

November

12 19 26 3

December

10 17 24 31

2019

7 14 21

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1090SIEMENS LTD (1,048.00, 1,068.30, 1,035.60, 1,064.55, +19.8000)


[email protected]

HEM SECURITIES LIMITED

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not soliciting any action based on this information, all care has been taken to ensure that the facts are accurate, fair and reasonable. This information is not intended as an

offer or solicitation for the purchase or sell of any financial instrument and at any point should not be considered as an investment advice. Reader is requested to rely on his

own decision and may take independent professional advice before investing. Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited,

Directors and any of its employees shall not be responsible for the content. The person accessing this information specifically agrees to exempt Hem Securities Limited, Hem

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Disclosure of Interest Statement

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3. Hem & its Group Company Director Ownership of the Stock No

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SIEMENS LTD - Moneycontrol.comchats.moneycontrol.com/plus/upload_pdf_file/SIEMENS_HEM.pdf · 2019-01-07 · SIEMENS LTD Stock Coverage For Private Circulation Only HEM RESEARCH Date