Global brokerage firm JPMorgan has initiated coverage on ABB India and Praj Industries with a ‘Neutral’ rating, while assigning an ‘Underweight’ rating to Siemens India and Bharat Heavy Electricals (BHEL).
In terms of preference within the industrials space, JPMorgan ranks L&T, CG Power, Cummins India, and Thermax as its top picks.
Company NameRatingTarget Price (₹)ThermaxOverweight3,869CumminsOverweight4,649CG PowerOverweight840Praj IndustriesNeutral403ABBNeutral5,639Siemens IndiaUnderweight2,795BHELUnderweight185
The brokerage wrote in its report that India’s capex growth is stabilising at around 10%, following a period of strong 18-20% growth in the years after Covid-19. The recent slowdown is attributed to reduced government spending, owing to fiscal consolidation and execution challenges, as well as increased caution in the private sector due to subdued near-term demand, tariffs, and other constraints.
Although a return to the high 20%+ growth levels seen post-Covid is unlikely in the near term, JPMorgan believes a sustainable 10-11% capex growth rate is achievable, supported by several structural drivers: a continued policy push (with central government capex sharply higher year-to-date), strong power-sector investments, robust corporate balance sheets, healthy cash flows, and positive capital expenditure intentions.
In this moderate but stable growth environment, the brokerage firm sees selective opportunities for earnings expansion.
It prefers companies with strong structural tailwinds and optionality like CG Power, diversified end-market exposure like Cummins India, and margin improvement potential like Thermax.