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    Siemens

    SIEMENSNeutral
    Capital Goods·20 May 2025
    Management Summary

    Siemens reported mixed results with strong order growth across most segments except Low Voltage Motors. Digital Industries continues normalization cycle with first signs of recovery, while Smart Infrastructure and Mobility show robust performance. PAT impacted by extraordinary items including prior year property sale gain and current year demerger expenses.

    Highlights

    5

    • Order growth of 43.5% YoY with healthy Book-to-Bill ratio of 1.25

    • Order backlog at ₹415 billion, up 7.2% YoY providing good visibility

    • Revenue growth of 2.5% YoY despite DI normalization challenges

    • EBITDA margin at 12.5%, marginally impacted by volume and cost elements

    • Siemens Energy demerger completed on March 1, 2025

    Concerns

    1

    • Low Voltage Motors Business Future

    What Changed2

    vs Q2 FY26

    Tone shiftConfident and strategic → Cautiously optimistic with focus on profitable growthGuidance items4 → 3 (-1)

    Key financials

    Single quarter

    04 metrics
    1. 01New Orders₹0 Cr+43.5%YoY
    2. 02Revenue₹0 Cr+2.5%YoY
    3. 03EBITDA Margin12.5%0%YoY
    4. 04Order Backlog₹41,500 Cr+7.2%YoY

    Guidance & targets

    3
    CategoryTargetPriority
    Business Strategy
    Export Share Growth
    20%
    		Medium
    Manufacturing
    9000 HP Locomotive Production
    Ramp up from 5 to 20 to 60 to 100 locomotives
    		High
    Profitability
    Smart Infrastructure Margins
    Continue to increase
    		High

    Risks & concerns

    4
    RiskSeverity

    Private Sector CapEx Slowdown

    Private CapEx remains muted affecting DI business, mixed developments in conventional verticals including automotive, food & beverage — Other acknowledged

    medium

    Digital Industries Normalization

    DI margins dropped significantly due to volume decline, changed product mix, and increased import prices — Other acknowledged

    medium

    Geopolitical Trade Tensions

    Global trade tensions causing supply chain disruptions and longer delivery periods — Other acknowledged

    medium

    Low Voltage Motors Business Future

    After Siemens AG sold global Innomotics business, exploring future options for LVM business due to technology dependency — Other acknowledged

    high

    Q&A highlights

    3

    “this is very, very much very clearly a volume story. And the more you sell, the greater the volumes because the more you are able to cover your fixed costs”

    Clarifies path to profitability recovery in DI business through volume growth

    asked by Harshit Patel - Equirus

    1 min read4 chapters

    Detailed Narrative

    01

    Digital Industries Normalization Cycle

    DI business showing signs of bottoming out after significant normalization cycle. Order growth momentum visible from ₹7.6B in Q4 FY24 to ₹9.5B in Q2 FY25. Book-to-Bill ratio of 1.0 supports normalization view. Margins impacted by lower volumes, changed product mix, and import price pressures. Management expects return to pre-COVID margin levels of 6-8% as volumes recover.

    02

    Smart Infrastructure Strong Performance

    SI business delivering consistent growth with 14% order growth in Q2 and 6.6% revenue growth. EBITDA margins improved from 15.3% to 16.3% driven by electrification demand, power utilities growth, and emerging verticals like semiconductors and data centers. C&S Electric acquisition performing well with strong export growth.

    03

    Mobility Robust Pipeline

    Mobility shows strong order growth of 300% in H1 driven by rolling stock, railway electrification, and export orders. 9000 HP locomotive project on track with prototype under homologation. Revenue slightly down due to normal project delivery cycles. Strong pipeline for railways, metros, and signaling with 5-7 year visibility.

    04

    Market Environment Mixed

    Public CapEx driving growth in power utilities, railways, metros, and emerging verticals. Private CapEx remains muted with mixed performance across conventional sectors. Automotive, F&B, machine building showing flat growth while commercial buildings, pharma, cement performing reasonably well.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.