ABB India FY24 Annual Earnings Summary

As high-priced backlog is executed, new orders at current lower commodity prices may pressure margins.

Analyst raised concern about pricing pressure in standard drives; management acknowledged but emphasized premiumization trend.

Base orders were flat in Q2, impacted by election and budget-related delays; recovery depends on post-election momentum.

CFO noted that the advantage from stable commodity prices and order book pricing will thin, potentially compressing margins.

Management acknowledged global and local uncertainties that could impact demand, though they see no direct correlation with their diversified portfolio.

LT motors faced pricing headwinds due to competition and muted demand in heavy industries like cement and steel, though erosion has stabilized.

Large orders have longer gestation periods and are subject to customer-driven delays, as seen in the traction division's design change for railway orders.

Order growth moderated due to delayed decision-making in private capital expenditure, which could persist if economic uncertainty continues.

Analyst raised concern about Chinese competition; management acknowledged isolated incidents in large projects where Chinese players offered aggressive pricing.

Current high margins benefited from past price push and low commodity costs; as markets ease, margins may compress to the guided 12%-15% PAT range.

Motion orders were flattish due to postponement of some system orders; recovery expected in Q2.

Revenue was INR 200 crore lower than potential due to alignment with customer project schedules and election-related delays.