Religare Institutional Research has maintained 'Sell' on Siemens citing prohibitively high valuations. It has target of Rs 725 on Siemens.
Commenting on the rationale, the stock broker said, ''Siemens's Q4FY14 sales of Rs 32 billion (-2% YoY, in line with RCMLe) were hit by project execution delays in the metals sector and absence of large projects in the energy business.
EBITDA margins however were supported by higher price realisations in the short-cycle business and cost optimisation (EBITDA margin + 160bps YoY to 5.6%), in turn pushing up adj. PAT to Rs 1.45 billion (+50% YoY). We roll over to Dec'15 TP of Rs 725 (from a Sep'15 TP of Rs 700).
Siemens's net working capital position at FY14-end remained largely flat YoY at 42 days as the increase in inventory/receivable days was compensated by higher payable days. Cash on balance sheet almost doubled YoY to Rs 11.2 billion.''
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