Buy ABB India, target price Rs 2000: Motilal Oswal

Motilal Oswal has buy call on ABB India with a target price of Rs 2000. The current market price of ABB India is Rs 1704.9. Time period given by analyst is one year when ABB India Ltd. price can reach defined target.

ABB India Ltd., incorporated in the year 1949, is a Large Cap company (having a market cap of Rs 36128.26 Crore) operating in Engineering sector.

Financials
For the quarter ended 30-06-2021, the company reported a Standalone Total Income of Rs 1450.17 Crore, down -12.35 % from last quarter Total Income of Rs 1654.41 Crore and up 43.24 % from last year same quarter Total Income of Rs 1012.40 Crore. Company reported net profit after tax of Rs 70.26 Crore in latest quarter.

Investment Rationale
ABB is a pure play on long-term industrial automation and ‘Make in India’ theme. It stands to benefit from the ongoing PLI-driven increase in manufacturing across the country. The short cycle nature of the business implies a very swift recovery, if the economy continues to improve. The brokerage maintains Buy rating, with a TP of INR2,000 per share (60x Jun’23E EPS). The brokerage expects its premium valuations to sustain in the near term, given the growing opportunity in the Manufacturing space in India, and likely higher adoption of Automation Solutions in various industries.

Promoter/FII Holdings
Promoters held 75 per cent stake in the company as of June 30, 2021, while FIIs held 3.7 per cent, DIIs 7.1 per cent and public and others 14.2 per cent.