Nuvama Institutional Equities has initiated coverage on SG Mart and Siemens Energy India with a bullish outlook, assigning a ‘BUY’ rating on both stocks. The brokerage set target prices of Rs 777 for SG Mart and Rs 4,200 for Siemens Energy India, citing strong growth opportunities, improving profitability, and favourable industry tailwinds.
Shares of SG Mart gained 3.7% during Thursday’s trading session, touching an intraday high of Rs 659.40, while Siemens Energy India rose 1.5% to hit a high of Rs 3,455. Based on Nuvama’s target prices, SG Mart offers a potential upside of around 18%, while Siemens Energy India could deliver approximately 21% upside from current levels.
SG Mart: Building a manufacturing legacy in steel
Nuvama believes SG Mart is emerging as a key player at the intersection of India’s evolving steel distribution ecosystem, B2B marketplace opportunity, renewable energy structures, and branded steel products market.
The brokerage noted that SG Mart has transitioned from being a trading platform into a manufacturing-focused company, with a growing presence in value-added steel products.
“Erecting a manufacturing legacy,” Nuvama highlighted, stating that the company is still in the early stages of building market credibility but has a strong growth roadmap ahead.
The brokerage expects SG Mart to deliver a revenue CAGR of 31%, EBITDA CAGR of 76%, and PAT CAGR of 73% between FY26 and FY29E. Return on Capital Employed (RoCE) is projected to improve significantly from 10% in FY26 to 27% by FY29E, despite planned capital expenditure of around Rs 1.5 billion over the next three years.
Nuvama believes SG Mart’s growth strategy, supported by improving cash flows and a debt-free balance sheet, could position the company for strong expansion. The brokerage also highlighted rising promoter confidence, with promoter holding expected to increase to nearly 58%. Valuing the company at 15x EV/EBITDA discounted to Q2FY29 estimates, Nuvama arrived at a target price of Rs 777 and initiated coverage with a ‘BUY’ rating. However, the brokerage cautioned that steel price volatility and execution risks remain key challenges.
Siemens Energy India: HVDC opportunity remains a long-term growth trigger
For Siemens Energy India (SEIL), Nuvama sees significant upside from India’s expanding high-voltage transmission and distribution (HV T&D) investments, estimated at around Rs 8 trillion.
The brokerage highlighted that SEIL is among the key beneficiaries of this opportunity, supported by strong exports, improving margins, and a diversified business mix. The Power Transmission segment, which contributes around 65% of operating income, is expected to drive growth with a projected 30%+ EBITDA CAGR. Meanwhile, the Power Generation segment provides additional growth potential through industrial capital expenditure, thermal upgrades, and possible future nuclear energy investments.
Nuvama expects Siemens Energy India to maintain a strong growth trajectory, with revenue projected to grow at a 27% CAGR between FY26E and FY28E. The brokerage estimates the company’s earnings per share (EPS) to rise at a 28% CAGR, supported by strong order inflows, operational efficiency, and improving business mix. It further expects return on equity (RoE) to remain robust at around 29%, while EBITDA margins are projected to expand to 21.5% by FY28E, driven by operating leverage and higher export contribution.
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The brokerage highlighted that SEIL currently trades at a discount compared with peers, with the stock valued at around 50x FY28E P/E compared with peer valuations of nearly 60x. With an order backlog exceeding Rs 184 billion, equivalent to about 2.4x FY25 sales, Nuvama believes the company is well placed to benefit from sustained T&D demand and steady Power Generation growth.
The brokerage has valued SEIL at 60x FY28E EPS of Rs 70.1, arriving at a target price of Rs 4,200 and initiating coverage with a ‘BUY’ rating. Nuvama also noted that potential opportunities in VSC-HVDC projects and nuclear energy expansion remain additional upside triggers that are currently not included in estimates.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
