ABB India shares jump 7% to hit new highs; brokerages remain positive on the stock

The total market capitalization of ABB India scaled Rs 1.35 lakh crore.

ABB India shares have surged more than 90 per cent in the last one year. The stock has zoomed more than 435 per cent in the last five years, while it has zoomed more than 775 per cent from its covid-19 lows. The stock is up 50 per cent in the last six months, while it is up 35 per cent in the year 2024 for the day so far.

Global brokerage firm UBS remains bullish on ABB India. The overseas banker believes that electrification and motion will drive growth and margins in the coming days. It also believes that ABB India is the best player on infrastructure scale-up in voltage electrification.

UBS also expects significant scope to ramp up the voltage electrification portfolio where it trails Schneider and SIEM. “We assume better growth in export orders with premium product mix and operating leverage. We also expect improvement in margins, which should support premium valuations,” it added.

UBS has a ‘buy’ rating on ABB India with a target price of Rs 7,550 on the stock, suggesting an upside of 26 per cent from its previous close. Another overseas brokerage firm Jefferies too has maintained the ‘buy’ call but has raised the target to Rs 6,250 from Rs 6,115. However, its targets have already been met.

Last week, ABB India had announced that its Peenya campus in Bengaluru has been certified water positive by the Green Rating for Integrated Habitat Assessment (GRIHA) Council. With this, three out of its six manufacturing locations are now ‘water positive,’ said the company in an exchange filing.

The rise in ABB India had a rub-off effect on other capital good stocks as well. Other stocks including Siemens, Bharat Heavy Electricals (BHEL), Thermax, Bharat Electronics (BEL) rose up to 3 per cent each in the early session on Wednesday.

Anand Rathi Shares & Stock Brokers expect BEL to see strong growth going forward due to many factors such as moving towards self reliance in defence; robust pipeline and focus of exports by government; strong order inflow to drive the revenue growth; and healthy profitability and return indicators. “We re-initiate a ‘buy’ coverage with a target price of Rs 250,” it said.

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