ABB India Ltd. share price target

Micros to Drive Growth for ABB India: ABB revenue for the quarter grew by 22% YoY basis driven by strong growth in Power Grids (~ 41%) on front-ended execution of UHVDC project, Robotics and Motion (~ 34%) grew on the back of absorption of products in the market and Industrial Automation (~ 8%) grew on continued investment in productivity and efficiency gains related investments in Cement, Auto and Food & Beverages sectors.

ABB India has delivered an in-line performance both on top-line and bottom-line front in 2QCY18. Its reported revenue rose by 14.4% YoY (adjusted for Excise Duty- revenue up 21% YoY) to Rs27.1bn led by healthy growth in Power Grids (+41% YoY), Robotics & Motion (+34% YoY) and Industrial Automation segment (+7.5% YoY). Its EBITDA margin rose by 100bps YoY to 7.2% owing to higher margin across three business segments, while reported PAT surged by 36% YoY to Rs1.0bn led by margin expansion and higher sales. The Company secured orders worth Rs24.7bn (+8% YoY) during the quarter taking its order book to Rs107bn (-11% YoY). As per the Management, maturing cycle of Raigarh-Pugalur UHVDC project, medium voltage portfolio...

ABB India (ABB) is an Indian subsidiary (75%) of Swedish-Swiss based global company ABB Ltd. With over 69 years of domestic operations, ABB's key business segment includes power grids (transformers, substations, HVDC, grid stabilisation/automation systems), electrification products (switchgears, solar inverters, EV chargers), robotics and motion (industrial robots, drives, motors, generators) and industrial automation (process automation, enterprise solutions) serving customers in utilities, industry and transport & infrastructure. With strong competencies and technology leadership in most of the above segments, proven expertise...

ABB revenue grew by 17% on the back of strong growth in Power Grid (PG) segment as the company has started booking High-Voltage Direct Current (HVDC) revenues and higher traction in Robotics and Motion (RM) which grew by 20% in Q1CY18. Industrial Automation (IA) was flat and Electrification products (EP) was down by 5% in quarter.

ABB India's revenue grew by 17.4% YoY to Rs25.2bn in 1QCY18 led by better performance by Power Grids and Robotics & Motion divisions. While revenue from Industrial Automation marginally grew by 1.2% YoY, revenue from Electrification Products dipped by ~5.5% YoY. Its PAT grew by 13.9% YoY to Rs1.0bn owing to better operating performance despite reduced other income and higher tax outgo. Notably, correcting by ~20% in last 3 months, the stock now trades at attractive valuation. Hence, we change our recommendation to BUY from HOLD...

Revenue fell by 8.93% to Rs. 2495.1 Cr in Q1CY18 when compared to the previous quarter. ABB India Ltd Q1CY18 results Comment

1QCY18 revenue rose 17.4% to INR25.3b, broadly in line with our estimate of INR25.8b. EBIDTA margin of 7.5% (flat YoY) was below our estimate of 9.6%. EBITDA grew 17.4% YoY to INR1.9b, below our estimate of INR2.5b, impacted by an adverse revenue mix, an increase in raw material prices and strengthening of EUR. PAT of INR1.0b, too, missed our estimate of INR1.4b

Improving financials, but outgo to group rises 4x in 10 years We read ABB India's CY17 annual report and the key takeaways are as follows: a) healthy free cash flow generation continued as FCF yield stood at 1.5%, led by improvement in the NWC cycle, b) gross margins scaled up to 10-year highs, but a 4x jump in outgo to parent/group entities from 1.9% to 7.7% of sales has led to moderate growth in EBITDA/PAT (6%/12% in CY17 and -0.6%/-2.3% CAGR over the last 10 years), c) management indicates an improved outlook due to increased opportunities in transportation (railway modernisation and EV charging infra), energy efficiency, service income, renewables (although margins may...

Revenue grew by 44.8% to Rs. 2739.79 Cr in Q4CY17 when compared to the previous quarter. ABB India Ltd Q4CY17 results comment

ABB's Q4CY17 (December year ending) order inflow at Rs 29 bn was up 45% YoY excluding the large HVDC order of ~Rs 36 bn year ago. Order inflow was driven by strong growth in base orders (up 13% YoY), exports and services. Order backlog at Rs 115 bn was down 2% YoY.