What makes Motilal Oswal bullish on Siemens Energy with 27% stock upside?

Motilal Oswal reiterated its 'Buy' rating on Siemens Energy with an unchanged target price of ₹3,800, an upside of 27 per cent from Wednesday's closing price

Motilal Oswal Financial Services said Siemens Energy India Ltd. highlighted a strong opportunity pipeline across domestic and international markets for its power transmission business at its recent analyst meet, thereby seeing over 25 per cent upside for the stock. 

 

The brokerage noted the management's confidence in delivering 10-15 per cent year-on-year (Y-o-Y) sustainable growth in the power transmission segment, aided by margin improvement from pricing power and operating leverage. It also expects adequate utilisation of new capacities coming on stream in FY27, supported by healthy enquiry levels.

 

Motilal Oswal said it broadly maintains its estimates and expects revenue, Ebitda, and PAT to clock a compound annual growth rate of 27 per cent, 32 per cent and 34 per cent, respectively, over the financial years 2025 to 2028. Growth will be led by strong traction in the power transmission segment, which is seen delivering a 39 per cent CAGR, while the power generation business may grow around 9 per cent.

 

The brokerage reiterated its 'Buy' rating on Siemens Energy stock with an unchanged target price of ₹3,800, an upside of 27 per cent from Wednesday's closing price.  ALSO READ | Nomura slashes Kaynes Tech target on smart-meter woes; retains 'Buy' 

According to Motilal Oswal, the company's focus on VSC-based high-voltage direct current (HVDC) projects means limited near-term opportunities in this niche could weigh on domestic HVDC order inflows, though the total addressable market remains robust for non-HVDC projects. The power generation business, which caters to base industries such as cement, steel, sugar and ethanol, is expected to grow slightly slower than power transmission.

 

On the power generation side, the brokerage said the company delivered double-digit revenue growth with stable profitability in FY25, supported by its large installed base and strong services business. Siemens Energy’s technology powers around 55 per cent of India’s large steam turbines and 25 per cent of its gas turbines, underpinning long-term opportunities in services, modernisation and upgrades.

 

In the industries and new energy segment, growth is expected from electrification and automation of process industries, expansion of data centres and maritime electrification, and emerging platforms such as PEM electrolysers and power-to-X under the Green Hydrogen Mission.  ALSO READ | Muted FY26 to fuel strong FY27 sales, profit rebound for India Inc: CLSA

Siemens Energy India stock price movement 

The heavy electrical equipment maker's stock fell as much as 2 per cent during the day to ₹2,935 per share, the biggest intraday fall since December 8 this year. The stock pared losses to trade 1.8 per cent higher at ₹2,940 apiece, compared to a 0.03 per cent advance in Nifty 50 as of 10:43 AM. 

 

Shares of the company fell for the second straight session on Thursday. Siemens Energy has a total market capitalisation of ₹1.04 trillion. 

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