page onwards For details on the shafts see C B2-DH-18-A Bevel-helical speed reducer B2

Flender/Flender Gear Units/Bevel-helical speed reducer B2

nallocated capital employed stood at Rs 7.8bn, of the total capital employed of Rs 9.8bn The company states that it has strong Order Backlog of over one years Revenue, with new orders during 4QFY2 at Rs 3.2bn. We estimate FY2 order backlog to be at Rs ~1bn We tweak our FY2/2 /2 estimates due to MD biz. divestment and faster than expected execution normalization. We have also baked in margins expansion on back of co st optimization measures taken by the company and better margins in the order book from newer orders Unallocated 6%GP 2%SI 7%MO 3%DI 2%Portfolio of Companies 4%Others 1% 1 1 2 2 3 3 4 1 1 1 1 1 1 1 1 1 1 1 3QFY1 4QFY1 1QFY1 2QFY1 3QFY1 4QFY1 1QFY2 2QFY2 3QFY2 4QFY2Book -RHS Inflow -LHS Revenue -LHS Page | 5 Siemens : Results Review 4QFY2 Outlook and valuation Maintain REDUCE Rating given punchy valuations roll forward TP (Rs 1, to Dec-2 (3x). TP increase driven by FY2E/2E/2E EPS upgrades . While SIL is well placed to monetize its strength in digitalization of Manufacturing/Smart Infra, we feel the positives are well captured in the current valuations. prolonged delay in private capex recovery or private investm ents can also dampen the inflows. Recent stock price run up more than adequately prices in the upsides on account of ( Margins expansion due to cost driven measures, pricing power is still not formidable driver given fragile recovery/sustenance of reco very ( Manufacturing incentives yet to meaningful play out on the ground and may take longer ( Exports and services ramp -up from here on seems to be limited after strong FY2 lower revenue base . We will wait for further evidence on demand recovery sust enance and large scale pickup of local manufacturing shift and digitalization adoption. We value Siemens standalone operations at 3x Dec-2E earnings and arrive at TP of Rs 1, 3/sh. Maintain REDUCE with TP of Rs 1,3/sh (3