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Decent performance…

About the stock: Siemens Ltd (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

Q4FY22 Results: Siemens reported a decent set of Q4FY22* numbers.

* Consolidated revenue was at | 4657.1 crore, up 8.4% YoY

* EBITDA came in at | 516 crore with margins of 11.1%, supported by stable gross margins

* Consequently, PAT came in at | 652.3 crore, up 102.8%

* Order inflow for Q4FY22 was decent at ~| 4009 crore, up 25% YoY

What should investors do? 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

Target Price and Valuation: We value Siemens at | 3630 on an SoTP basis.

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

Alternate Stock Idea: We also like ABB in our coverage.

* ABB continues to see a recovery in certain segments and industries like data centre, renewables, electronics, food & beverages and pharma. It continues to focus on order win and seamless execution across projects

* BUY with a target price of | 3635

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