Shares of ABB India jumped over 9% to Rs 2,189 on the BSE
in Thursday’s intra-day trade after the company showed strong performance in
the March quarter of the financial year 2021-22.  ABB India shares gained more than 60% in one year
and over 150% in two years.

The engineering services company reported a two-fold jump
in net profit at Rs 370 crore for the March 2022 quarter compared to the net
profit of Rs 151 crore in the March 2021 quarter.

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ABB India’s revenue grew 20.8% year on year (YoY) to Rs
1,968 crore in the March 2022 quarter from Rs 1,629 crore in the year-ago
period. Operational earnings before the interest, taxes, depreciation and
amortization (EBITDA) margin improved 170 basis points (bps) to 8.5% from 6.8%.

The company follows a January to December financial year.

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The capacity utilization & operation efficiencies led
to profit growth during the quarter. Total orders jumped to Rs 2,291 crore, the
highest for the first quarter in the past five years. The company has a strong
order backlog of March 31, 2022, at Rs 5,229 crore, which gives revenue
visibility and is well aligned to support growth plans in the remaining year.

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“The various government projects incentivizing local
production, fast-tracking infrastructure projects, housing and water for all,
specific measures for various sectors like solar, water, data centres, metros,
etc. is likely to have an incremental positive impact and provide some cushion
for the macro uncertainties,” ABB India said.

The heavy electric equipment maker said it is benefitting
from business opportunities to provide greater sustainability and efficiency in
certain core sectors of energy, metals, railways & metro and cement.

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In a post-results
note, analysts at Nomura said, “We value ABB at 60x CY23F EPS of Rs 34.2
to arrive at our target price of Rs 2,052. We prefer Honeywell Automation in
the segment. Delivery on EBITDA margin and order inflows are key upside risks
while sluggish industrial Capex and commodity price rise are downside
risks”.