Tale of the Tape 

Good evening everyone. Welcome back to the market of stocks!

Nifty (+0.7%) and Sensex (+0.6%) snapped a five-day red streak, tracking gains across global markets. Midcaps (+0.3%) and Smallcaps (-0.1%) traded mixed. The advance-decline ratio was split evenly.

Except Media (-0.4%) and Auto (-0.1%), all other sectors ended in the green. Real Estate (+1.5%) and Banks (+1.1%) saw the most buying.

Siemens is down -11% in the past two days. Should you buy the dip or avoid it? Check out our top story below for all the deets. 

Unimech Aerospace IPO kicked off today. Read our analysis below to help you decide whether to subscribe.

Steel stocks killed it today. Look at their charts below to find out why.

Niva Bupa Health was in focus after Morgan Stanley initiated coverage; the brokerage sees a +15% upside from current levels.

Zomato (-3%) and Swiggy (-2%) were under pressure after the GST council postponed its decision to reduce GST on online food delivery to 5% (vs 18% currently). 

Waaree Energies (+2%) will invest Rs 3,500 cr across its electrolyser, lithium ion battery and inverter businesses.

India Cements rallied +8% after the CCI okay-ed the Ultratech Cement takeover.

Order wins. Sterling and Wilson Renewable Energy gained +6% after bagging a ~Rs 1,200 cr Gujarat solar plant contract. JBM Auto rallied +5% intraday after its subsidiary won a Rs 1,800 cr electric bus tender for Ahmedabad city.

IPO update. Mamta Machinery IPO was oversubscribed 190x on the final day. DAM Capital and Transrail Lightings IPO got oversubscribed +80x each.

Here are the closing prints:

Market
Siemens: We’re In The Endgame Now

Siemens is down ~11% in the last two days after it projected a bleak 2025 outlook at its recent analyst meet. If you’re thinking the recent correction offers a good chance to buy the dip, here’s what you need to know first. 

The company has two major verticals. Energy and ‘everything else’ (railways/metro, digital & smart infra). The core cash cow aka energy is looking at significant headwinds. The actual transmission & distribution industry is fine. The problem is that Siemens may lose out on huge orders because its parent company is pivoting to a new tech. It’s a lot of jargon, but GOI wants one kind of technology, and Siemens is moving towards another. As Nuvama puts it: Siemens total addressable market stands to be “significantly reduced”. PS - it gets even worse because the margins for Siemen’s energy biz already took a hit in FY24, coming in at ~13% vs industry average of 15%-20%. This whole issue is further compounded by the weakness in its other business verticals, which sucks

The broader issue is that Siemens depends on capex spending. If GOI and private operators spend, it makes money. This sucks because GOI spending is down for H1FY25 (due to elections) and private capex has been awful in India for a long time now. Now, Siemens expects things to turn around in H2FY25, but we really don’t know what will happen. It’s also trying to pivot towards exports and even earmarked capex of Rs 1,100 cr across verticals but this is unlikely to pay off soon.

Big Picture: Every company goes through a downcycle. These things are normal. The thing is Siemens commands premium valuations. It's trading at ~80x FY25 earnings which is expensive AF. If you want that kinda price tag you need to deliver. FYI - Nuvama has cut its target price to Rs 7,000 p/sh vs Rs 8,350 earlier.

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