ABB India Shares Rise as Brokerages Upgrade Target for 2026

Introduction

Shares of ABB India Ltd. saw a notable increase, gaining nearly 1% in early trading on Tuesday, February 23, 2026. The surge followed positive recommendations from major brokerages, which revised their target prices for the technology company. This investor optimism was further fueled by the company's strong performance in the financial year ending December 31, 2025, and the announcement of a substantial final dividend.

During the session, the stock reached an intraday high of Rs 6,010 per share on the BSE, reflecting renewed confidence in its growth trajectory. The positive market reaction underscores the company's solid operational performance and its promising outlook for the coming year.

Record-Breaking Financial Performance in FY25

ABB India concluded its financial year 2025 on a high note, reporting its highest-ever annual orders and revenues. The company secured orders worth Rs 14,115 crore, an 8% increase compared to the previous year. Full-year revenue also reached a record Rs 13,203 crore. This growth was broad-based, with significant demand from sectors such as data centers, automotive, railways, and general infrastructure.

The fourth quarter was particularly strong, with order inflows surging by 52% year-on-year to Rs 4,096 crore, the highest Q4 order intake in the last five years. This momentum was driven by a combination of a healthy base business and the successful closure of several large orders. Key projects included providing low-voltage switchgear for major data centers and propulsion systems for Indian Railways.

Navigating Margin Pressures

Despite the record top-line performance, ABB India faced profitability challenges. The company's net profit for the December quarter declined by 18% to Rs 434 crore from Rs 532 crore in the same period last year. This was primarily due to rising input costs, including material and labor expenses, as well as metal price volatility and currency fluctuations.

For the full year, the Profit Before Tax (PBT) margin stood at a healthy 16.9%, though it reflected the impact of these cost pressures. Management highlighted that operational efficiency measures and commodity hedging strategies helped mitigate some of these headwinds. The company's strong Return on Capital Employed (ROCE) of 21% for the year indicates effective capital management despite the challenging macroeconomic environment.

Substantial Dividend Signals Confidence

Reflecting its strong financial position and confidence in future cash flows, ABB India's Board of Directors recommended a final dividend of Rs 29.59 per share for the financial year 2025. This represents a 1,480% payout on the share's face value of Rs 2. The board has fixed May 2, 2026, as the record date for the dividend payment, which is subject to shareholder approval at the upcoming Annual General Meeting.

This dividend announcement was well-received by the market, as it signals management's belief in the company's long-term value creation potential. The company's cash position stood at a robust Rs 5,694 crore at the end of the year, providing a solid foundation for both shareholder returns and future investments.

Brokerages Revise Price Targets

Following the strong results, several brokerage firms upgraded their outlook for ABB India. Motilal Oswal maintained a 'Buy' rating and raised its target price to Rs 6,600 per share, suggesting a potential upside of 12%. The brokerage noted that the earnings cut cycle for ABB appears to be over and expects margins to improve in the coming quarters. They forecast a revenue, EBITDA, and PAT compound annual growth rate (CAGR) of 15%, 18%, and 19% respectively over CY25-27.

JPMorgan also issued a 'Buy' recommendation with a long-term target price of Rs 6,001 per share. The upgrades were based on the revival of order inflows and the expectation of better margin performance going forward.

Key Financial Metrics

Here is a summary of ABB India's key financial indicators based on recent data:

Future Outlook and Order Backlog

ABB India enters 2026 with a formidable order backlog of Rs 10,471 crore, a 12% increase from the previous year. This strong backlog provides excellent revenue visibility for the upcoming quarters and aligns with the company's strategic expansion plans. With its diversified portfolio and leadership in industrial automation and electrification, ABB India is well-positioned to capitalize on India's continued focus on infrastructure development and the global shift towards the Fourth Industrial Revolution.

Conclusion

ABB India's performance in FY2025 demonstrates a resilient business model capable of delivering strong top-line growth despite macroeconomic headwinds. While margin pressures remain a key area to monitor, the record order inflows, robust order backlog, and a generous dividend policy have bolstered investor confidence. The positive revisions from brokerages suggest that the company is on a path to improved profitability, making it an attractive prospect for investors with a long-term perspective on India's industrial growth story.