ABB India, which reported a mixed set of numbers in the December 2024 quarter, has attracted some positive reports from the brokerage firms. However, analysts have largely slashed their targets on the stock on the back of muted order inflows and a sharp correction in the stock prices, but see up to 50 per cent upside in the counter.
ABB India reported a 56 per cent YoY jump in net profit at Rs 528.4 crore for the fourth quarter that ended December 31, 2024. The electrification and automation major reported a 22 per cent YoY to Rs 3,364.9 crore, while the Ebitda soared 57.6 per cent YoY to Rs 675.3 crore with margins expanding 19.5 per cent in the reported quarter.
Shares of ABB India Ltd, which follows the calendar year for the result season, dropped nearly 3 per cent to Rs 5,185.50 on Friday, compared to its previous close at Rs 5,345.05 on Thursday. The total market capitalization of the company stood slightly above Rs 1.11 lakh crore.
ABB India has delivered multibagger returns to the investors as the stock has zoomed nearly 720 per cent from its May 2020 lows. However, the stock has corrected nearly 44 per cent from its 52-week high at Rs 9,200. The stock touched its 52-week lows at Rs 5,016.20 a couple of sessions ago.
ABB India's Ebitda rose 58 per cent YoY which was above estimate, with the highest-ever margin, said InCred Equities. "ABB India still focuses on energy transition & infrastructure to strengthen its energy-efficiency portfolio and capitalize on emerging opportunities. We maintain our estimates and retain 'add' rating with a lower target price of Rs 7,627," it said.
Nuvama Institutional Equities stayed upbeat on ABB’s long-term growth led by data centres, railways and core industrial capex, despite near-term sluggishness and margins potentially at peak. It retained 'buy' rating even as it factors in slower inflows per quarter in CY25E/26E. It slashed its target price of Rs 6,650 from Rs 8,900 earlier.
"We like ABB for its diverse presence across key sectors of core industries and product range it has to capitalise the tailwinds in the capex growth of the economy. With strong balance sheet and ROCE generation we rate the stock as Buy and assign a fair value of Rs 6150 per share," said ICICIDirect Research.
Elara Capital lowered earnings due to margins likely having peaked out and now moving towards gradual normalization. "We introduce CY27E estimates. We cut our target price Rs 5,860 from Rs 6,660,,factoring in slower-than-expected growth momentum given lower budgetary allocation to infra," it added with an 'accumulate' rating on the stock.
However, Nomura has downgraded the counter to 'reduce', slashing its target price on ABB India on the back of influencing the change in target price is the company's disappointing order inflow, highlighting potential challenges in the near-term. It has a target price of Rs 4,970 apiece.