Large cap stock falls 6% after company’s management cuts margin guidance for its key segment

Synopsis:- The stock dropped nearly 6% after management cut margin guidance for a key segment from 12–14% to 6–8%, signalling earnings pressure. The company’s revenue grew 16% but its profit fell 42% to ₹485 crore. A ₹2,200 crore divestment and shifting demand trends reflect an ongoing portfolio and margin reset.

The shares of the largest engineering company fallen up to 6 percent from an intraday low of Rs 2,993.00 apiece after the company’s management cut the margin guidance for a key business vertical.

With a market capitalization of Rs 1,11,289.44 crore, the shares of Siemens Ltd were trading at Rs 3,126.40 per share, decreasing around 2.15 percent as compared to the previous closing price of Rs 3,195.15 apiece.

Guidance Cut

The shares of Siemens Ltd have seen bearish movement after management sharply reduced margin guidance for its Digital Industries (DI) segment. The revised outlook lowers margins to 6–8%, compared to the earlier 12–14% projection. Since DI contributes 20–25% of the company’s revenue, the downgrade signals potential earnings pressure, driven by weaker demand and rising competitive or cost challenges.

In the analyst call, management noted strong traction in electronics, battery manufacturing, solar cells, and pharma, which are driving demand. However, concerns remain around the rail and metro capex outlook within the motion segment. Despite this, Siemens expects motion segment margins to improve from 7.5% to 9.5–10%, signalling better profitability ahead.

Moreover, Siemens is restructuring its portfolio, with the board approving the sale of its Low Voltage Motor segment for ₹2,200 crore on a cash- and debt-free basis. The sale, subject to final adjustments, reflects the company’s strategy to streamline operations and focus on higher-growth, higher-margin businesses in its core industrial segments.

Financial & Operational Highlights

The company posted 16% revenue growth, rising from  Rs 4,457 crore in September 2024 to  Rs 5,171 crore in Septmber 2025. However, net profit fell sharply by 42% to  Rs 485 crore, indicating margin pressure, higher costs, or weaker profitability despite strong top-line performance, highlighting the need for improved operational efficiency.

Siemens Ltd have shown strong profitable growth for FY21–25 across Siemens’ key segments. The revenue grew 1.9x and EBIT 2.9x, while Digital Industries expanded more moderately. Smart Infrastructure delivered the strongest EBIT jump at 4.9x, and Mobility saw significant scale with 3.6x revenue growth, highlighting broad-based improvement and operational leverage across the portfolio.

Siemens Ltd is a leading technology and engineering company in India, offering solutions across electrification, automation, digitalization, and mobility. With strong capabilities in smart infrastructure, industrial automation, and mobility systems, the company supports India’s industrial growth while maintaining a diversified portfolio and a long track record of innovation and operational excellence.

Written by Abhishek Singh

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