Stock to buy for 60% upside: Why MOFSL likes Siemens Energy after recent correction
MOFSL said Siemens Energy's annual report 2025 highlighted strong growth prospects in transformation capacity by 2032 in domestic markets and a healthy outlook for export markets.
- Jan 26, 2026,
- Updated Jan 26, 2026 9:37 AM IST
MOFSL in its latest note on Siemens Energy India Ltd said most stocks in the transformer industry have corrected after the recent news flow related to the easing of Chinese curbs in bids. At the prevailing market price of Rs 2,123, it said Siemens Energy trades at nearly 25 per cent discount to Hitachi Energy. It finds Siemens Energy's valuation comfortable. The brokerage cut its target price for the stock to Rs 3,400 from Rs 3,800, but retained 'Buy' on the stock. The target suggests 60 per cent potential upside over the prevailing price.
MOFSL said Siemens Energy's annual report 2025 highlighted strong growth prospects in transformation capacity by 2032 in domestic markets and a healthy outlook for export markets. The company is expanding its capacity in transformers and high-voltage switchgear, which will enable it to target broader market demand in both domestic and export markets, MOFSL said.
"We expect its power transmission segment to continue to grow at a higher pace than the power generation segment. We believe that the recent uptrend in commodity prices can have a near- to medium-term impact on margins until it is passed through. In terms of easing curbs on Chinese players to bid for government contracts, our interactions with industry participants indicate that Chinese players may be required to set up capacities in India if these proposals are accepted," MOFSL said.
The domestic brokerage said it will take time to get approval and quality certifications and therefore the move may not impact the industry immediately.
"We cut our FY26, FY27 and FY28 estimates by 4 per cent, 5 per cent and 5 per cent to bake in the impact of high RM prices and competition by FY28. We maintain Buy with a revised target of Rs 3,400, based on 55 times December 2027E EPS," MOFSL said.
MOFSL said Siemens Energy India has highlighted a strong total addressable market (TAM) of Rs 9.2 lakh crore, driven by an expected increase in installed power generation capacity from 501GW in FY25 to 997GW by FY32, which would translate into almost doubling in transformation capacity from 1,382GVA to 2,412GVA at a CAGR of 10 per cent over the same period.
MOFSL said this should benefit Siemens Energy power transmission segment, which contributed 64 per cent and 54 per cent of overall inflows and revenue in FY25.
"We expect a 13 per cent CAGR in power transmission segment inflows over FY25-28. The power generation segment, contributing 46 per cent of revenue, is growing at a relatively slower pace as growth in base industries remains weak. As highlighted earlier, management expects high-single-digit growth in the power generation business. We bake in a 10 per cent CAGR in power generation segment inflows over FY25-28," MOFSL said.
MOFSL in its latest note on Siemens Energy India Ltd said most stocks in the transformer industry have corrected after the recent news flow related to the easing of Chinese curbs in bids. At the prevailing market price of Rs 2,123, it said Siemens Energy trades at nearly 25 per cent discount to Hitachi Energy. It finds Siemens Energy's valuation comfortable. The brokerage cut its target price for the stock to Rs 3,400 from Rs 3,800, but retained 'Buy' on the stock. The target suggests 60 per cent potential upside over the prevailing price.
MOFSL said Siemens Energy's annual report 2025 highlighted strong growth prospects in transformation capacity by 2032 in domestic markets and a healthy outlook for export markets. The company is expanding its capacity in transformers and high-voltage switchgear, which will enable it to target broader market demand in both domestic and export markets, MOFSL said.
"We expect its power transmission segment to continue to grow at a higher pace than the power generation segment. We believe that the recent uptrend in commodity prices can have a near- to medium-term impact on margins until it is passed through. In terms of easing curbs on Chinese players to bid for government contracts, our interactions with industry participants indicate that Chinese players may be required to set up capacities in India if these proposals are accepted," MOFSL said.
The domestic brokerage said it will take time to get approval and quality certifications and therefore the move may not impact the industry immediately.
"We cut our FY26, FY27 and FY28 estimates by 4 per cent, 5 per cent and 5 per cent to bake in the impact of high RM prices and competition by FY28. We maintain Buy with a revised target of Rs 3,400, based on 55 times December 2027E EPS," MOFSL said.
MOFSL said Siemens Energy India has highlighted a strong total addressable market (TAM) of Rs 9.2 lakh crore, driven by an expected increase in installed power generation capacity from 501GW in FY25 to 997GW by FY32, which would translate into almost doubling in transformation capacity from 1,382GVA to 2,412GVA at a CAGR of 10 per cent over the same period.
MOFSL said this should benefit Siemens Energy power transmission segment, which contributed 64 per cent and 54 per cent of overall inflows and revenue in FY25.
"We expect a 13 per cent CAGR in power transmission segment inflows over FY25-28. The power generation segment, contributing 46 per cent of revenue, is growing at a relatively slower pace as growth in base industries remains weak. As highlighted earlier, management expects high-single-digit growth in the power generation business. We bake in a 10 per cent CAGR in power generation segment inflows over FY25-28," MOFSL said.