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Siemens Limited Analysts/Institutional Investors Call Summary
Call Overview • Date: May 14, 2024 • Participants: CEO Sunil Mathur, CFO Wolfgang Wrumnig • Compliance: SEBI regulations
Q2 FY 2024 Results • Revenue Growth: 19.3% increase • Smart Infrastructure: 29% • Mobility: 59% • EBITDA: Increased to 15% (240 basis points improvement) • Profit Before Tax: Rose to 22.2% • H1 Performance: • Revenue growth of 20.6% • EBITDA stable at 13.6% (340 basis points improvement excluding foreign exchange impacts) • Cash from operations increased by Rs. 1.3 billion
Capital Investments • Total investments exceeding Rs. 1,000 crore • Smart Infrastructure: Rs. 333 crore for factory expansion in Goa • Mobility: Rs. 186 crore for a Metro train manufacturing facility in Aurangabad
Demerger Announcement • Energy Business: To be spun off into Siemens Energy India Limited • Expected Completion: By 2025, pending regulatory approvals • Market Position: Siemens Energy India to target a growing energy market with a projected CAGR of 9% until 2030
Business Growth and Strategy • Digital Industries: 33% growth • Smart Infrastructure: 28% growth • Mobility: Significant government investment in transportation infrastructure • Siemens Xcelerator: Launched in 2022 to address customer challenges with digital solutions
Future Outlook • CEO Insights: Positive economic outlook despite geopolitical risks • Focus Areas: Energy transmission, e-vehicles, and electrification • Export Strategy: Commitment to using India as a manufacturing base for global markets
Operational Improvements • Increased volumes and productivity measures driving operational efficiency • Healthy mix of short and long cycle orders from government and private sectors
Challenges and Responses • Employee Costs: Decline attributed to productivity gains • Digital Industries: Facing destocking challenges • Capacity Expansion: Proactive planning to meet future demand
Conclusion • Strong inquiry pipeline, stable overall demand, and strategic investments position Siemens Limited for continued growth and profitability.
Siemens Limited Analysts/Institutional Investors Meeting Summary
Meeting Overview • Date: December 21, 2023 • Communication to: National Stock Exchange of India and BSE Limited • Key Personnel: • Mr. Sunil Mathur (Managing Director and CEO) • Dr. Daniel Spindler (CFO) • Transcript available on Siemens' investor relations website • Included safety briefing and disclaimer on forward-looking statements
Company Performance Highlights • CEO Insights: • Strong finish to the previous year • India as a fast-growing market for Siemens AG • Key economic indicators: stable GDP growth, increased public infrastructure spending, improving private capex • Government capital outlay implementation at 70-80%
• Strategic Shift: • Transition from electrical to technology company • Focus on digital transformation and sustainability • Introduction of Digital Industries Business
• Innovations: • Launch of industry-ready 5G router in India • Integration of product business units for efficiency and cybersecurity
Financial Performance (FY 2023) • CFO Insights: • New orders increased by 138.8% year-over-year • Revenue growth of 21.3% across all business segments • Key financial metrics: • EBITDA: 12.7% • Profit Before Tax (PBT): 14.4% • Profit After Tax: 10.8%
• Quarterly Performance: • 25% revenue growth in Q4 • Consistent double-digit profitability
Business Segment Performance • Digital Industries (DI): • 4% growth in orders, 24% revenue increase • Smart Infrastructure (SI): • 25% growth in orders, 20% revenue increase • Mobility: • 746% order growth, volatile profitability • Energy: • 9% increase in orders, 13% revenue rise
Future Plans and Strategic Initiatives • Shareholding and Demerger: • Siemens AG plans to increase shareholding in Siemens Energy by 18% • Exploration of demerging Siemens Energy's India business by 2025
• Siemens Xcelerator Platform: • Aimed at providing scalable solutions across industries • Successful implementations in logistics and equipment efficiency
• Sustainability Goals: • Significant reductions in carbon footprint and waste by 2025 and 2030
Localization and Market Strategy • Focus on local production for domestic and global markets • Expansion in Transmission and Distribution (T&D) segment • Ongoing evaluation of C&S Electric's strategic fit post-acquisition
Q&A Highlights • Discussion on operating margins and growth in the Mobility Business • Concerns about rising global manufacturing costs and competitiveness • Clarification on Siemens Xcelerator Program and cybersecurity business growth potential
Conclusion • Optimism about the resilience and growth prospects of the Indian economy • Emphasis on digitalization as a key enabler for future growth and efficiency
Siemens Limited Analyst Call Summary (May 19, 2023)
Communication and Disclosure • Siemens Limited communicated the transcript of the analyst call to the National Stock Exchange and BSE. • The disclosure complies with SEBI regulations and is available on the investor relations website. • Signed by Ketan Thaker, Company Secretary.
Key Highlights from the Analyst Call • Leadership: Led by Mr. Sunil Mathur (MD & CEO) and key executives. • Business Sale: • Approval for the sale of low voltage motors and geared motors businesses to Siemens Large Drives India for Rs. 2,200 crore, effective October 1, 2023. • Valuation supported by Grant Thornton Bharat LLP and ICICI Securities Limited. • Valuation Rationale: • Valuation methods included DCF and market multiples, resulting in a range of Rs. 2,070 crore to Rs. 2,165 crore. • Sale proceeds to be distributed as a special dividend.
Strategic Focus • Acquisition: • Acquired Mass-Tech Controls' electric vehicle division for Rs. 38 crore to enhance EV charging infrastructure. • Market Positioning: • Emphasis on technology leadership and consolidation in high-growth areas. • Locomotive and Power Grid: • Confidence in pricing strategy and margin expectations despite competition. • Positive trends in transmission projects, with anticipated demand for high voltage solutions.
Future Growth Areas • Automation and Digitalization: • Strategic shift towards these sectors, with a focus on core competencies. • Market Opportunities: • Strong pipeline in railway opportunities and metro projects. • Local Manufacturing: • Ongoing evaluation of local manufacturing versus imports, with past examples cited.
Analyst Inquiries and Responses • Minority Shareholder Concerns: • Emphasis on focusing on core competencies and addressing uncertainty for minority shareholders. • Low Voltage Motor Business: • Acknowledgment of declining contribution to profit; strategic shift towards higher-growth areas. • Valuation Report: • Available on the website; reflects growth areas beyond low-voltage motors.
Conclusion • Siemens Limited is strategically positioning itself for future growth by divesting non-core businesses, enhancing its technology capabilities, and focusing on high-growth sectors while addressing shareholder concerns.