Shares of ABB India Ltd. fell as much as 6% on Wednesday, after its global parent ABB Global shared a business update for the quarter gone by. This is the worst single-day fall for the stock in five months.
In its update, ABB Global’s commentary with regards to the Indian market was positive, but it was not quantified as no numbers were shared. This is in contract to the June quarter, where the India order growth was reported to be 81%.
Analysts who track the stock, are pegging the India order intake for the September quarter to be ₹4,400 crore, which is nearly flat on a sequential basis despite the strong country-specific commentary. The estimates range between ₹4,400 crore to ₹4,600 crore.
A note from InCred said that the new ABB-Mitsubishi JV will prove to be a new overhang on exports as that JV will target Malaysia, Thailand, Vietnam and Indonesia Geographies.
The India number also includes overseas ABB bookings.
Margins and the company’s segment mix is something that will be keenly watched by the street going forward. ABB India will be reporting its quarterly results on November 13.
ABB India has more “sell” recommendations than “buy”, with 14 out of the 33 analysts who track the stock having a “sell” rating, compared to only nine “buy” recommendations. 10 others have a “hold” rating on the stock. The consensus estimates of price targets implies an upside potential of 7.6% from current levels.
Brokerages such as Citi, Macquarie and Axis Capital maintained their “Sell”, “Underperform”, and “reduce” ratings on the stock respectively.
Shares of ABB India are trading 5.5% lower on Wednesday at ₹6,590. The stock is down 17% from its recent 52-week high of ₹7,924. The stock is still up 28% so far this year.