SIEMENS - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 4.2

📊 Core Financials Analysis

Profitability

ROE of 17.4% and ROCE of 23.2% reflect strong capital efficiency and operational performance.

EPS of ₹66.9 supports solid earnings, though PAT declined from ₹499 Cr to ₹369 Cr QoQ (−5.19%), indicating short-term softness.

Balance Sheet Strength

Debt-to-equity ratio of 0.01 is excellent, showcasing near-zero leverage and robust financial discipline.

Dividend yield of 0.36% is modest, consistent with a growth-oriented reinvestment strategy.

Cash Flow & Stability

Book Value of ₹344 vs Current Price ₹3,318 implies a P/B ratio of ~9.64, indicating premium pricing.

PEG ratio of 2.33 suggests overvaluation relative to earnings growth.

📉 Valuation Metrics

Metric Value Insight

P/E Ratio 71.4 Overvalued vs industry PE of 49.5

P/B Ratio ~9.64 Premium valuation

PEG Ratio 2.33 Indicates stretched valuation

Intrinsic Value ~₹2,800–₹3,000 Estimated below current price

Siemens Ltd is overvalued based on traditional valuation metrics, though its fundamentals remain strong.

⚙️ Business Model & Competitive Advantage

Sector: Siemens Ltd operates in industrial automation, electrification, smart infrastructure, and mobility solutions.

Strengths

Global parentage and access to cutting-edge technology

Strong order book and diversified industrial exposure

Near-zero debt and consistent profitability

Challenges

High valuation multiples

Recent decline in quarterly profits

Slight reduction in FII and DII holdings

According to Alice Blue’s fundamental analysis, Siemens has shown impressive revenue growth from ₹13,639 Cr in FY22 to ₹19,554 Cr in FY24, with net profit rising from ₹1,090 Cr to ₹1,962 Cr. Operating margins have improved from 11% to 13%, and EPS has grown from ₹30.62 to ₹55.09, reflecting strong shareholder value creation.

📌 Entry Zone Recommendation

Suggested Entry Range: ₹2,900–₹3,100

Below 50 DMA (₹3,166) and closer to intrinsic value

RSI at 63.5 suggests mild overbought conditions

MACD positive, but momentum may be peaking

🧭 Long-Term Holding Guidance

Hold if Already Invested: Siemens is a high-quality industrial leader with strong fundamentals and long-term growth potential.

Wait for Better Entry if New Investor: Valuation is stretched; a dip would offer better risk-reward.

Watchlist Triggers

EPS acceleration

Margin expansion

Institutional accumulation

Siemens Ltd is a premium industrial play with global backing and strong execution. While its fundamentals are impressive, the current price demands patience and precision for new entries.

Edit in a page