Siemens gains on strong operational performance in Q1

The stock hit a 52-week high of Rs 1,093 on NSE in intra-day trade.

Shares of Siemens has rallied 5% to Rs 1,089 on National Stock Exchange (NSE) in otherwise weak market after the company said its operating profit margin expanded by 270 bps to 6.1% for the quarter ended December 31, 2014 (Q1) quarter against 3.4% in the same quarter last year.

The stock opened at Rs 1,042 and touched a 52-week high of Rs 1,093 on NSE. A combined 273,357 shares changed hands on the counter till 1107 hours on NSE and BSE.

“For the first quarter of financial year 2015 ended December 31, 2014, the company registered higher new orders of Rs 2,089 crore compared to Rs 2,009 crore in the same period last year,” Siemens said in a statement.

Meanwhile, the company posted net profit of Rs 634 crore in Q1 as compared to Rs 65 crore, largely due to cost optimization measures and an exceptional gain of Rs 705 crore from the sale of the of Metals Technologies business.

However, analysts at Motilal Oswal Securities maintain ‘sell’ rating on the stock with revised target price of Rs 930 per share.

“Correcting the manufacturing footprint and increasing localization has been an important structural overhang for Siemens that is yet to be decisively addressed, in our opinion,” Satyam Agarwal and Amit Shah analysts at Motilal Oswal Securities said in a report.