Current Rating and Its Significance
MarketsMOJO’s 'Hold' rating for ABB India Ltd indicates a neutral stance on the stock, suggesting that investors should maintain their existing positions rather than aggressively buying or selling. This rating reflects a balanced view of the company’s strengths and challenges as of today. The rating was adjusted on 18 Nov 2025, moving from a 'Sell' to a 'Hold', signalling an improvement in the company’s outlook, but the current analysis focuses on the latest data available as of 05 January 2026.
Quality Assessment: Strong Fundamentals Amidst Flat Recent Results
As of 05 January 2026, ABB India Ltd continues to demonstrate excellent quality metrics. The company is characterised by a robust long-term fundamental strength, highlighted by an impressive operating profit growth rate of 58.94% annually. This growth underscores the company’s ability to expand its core operations effectively over time.
Additionally, ABB India Ltd maintains a very low debt profile, with an average Debt to Equity ratio of zero, indicating a conservative capital structure that reduces financial risk. The company’s profitability is further emphasised by a high average Return on Capital Employed (ROCE) of 78.62%, which signifies efficient utilisation of capital to generate earnings.
However, recent quarterly results have been flat, with Profit Before Tax (excluding other income) falling by 9.20% to ₹458 crore and Profit After Tax declining by 7.2% to ₹408.76 crore. These figures suggest some near-term operational challenges despite the strong underlying fundamentals.
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- - Fundamental Analysis
- - Technical Signals
- - Peer Comparison
Valuation: Premium Pricing Reflects Market Expectations
Currently, ABB India Ltd is considered very expensive based on valuation metrics. The stock trades at a Price to Book (P/B) ratio of 15.3, which is significantly higher than typical market averages and indicates that investors are paying a premium for the company’s shares. This premium valuation is supported by a Return on Equity (ROE) of 24.6%, reflecting strong profitability for shareholders.
Despite the high valuation, the stock is trading at a discount relative to its peers’ historical averages, suggesting some relative value within its sector. The company’s Price/Earnings to Growth (PEG) ratio stands at 13.2, which is elevated and implies that earnings growth expectations are priced in at a high level.
Financial Trend: Stability Amidst Recent Flat Performance
The financial trend for ABB India Ltd is currently flat. While the company has experienced a 4.7% increase in profits over the past year, the stock price has declined by 23.26% during the same period. This divergence indicates that the market has not fully rewarded the company’s earnings growth, possibly due to concerns about near-term performance or broader sector challenges.
Over the last six months, the stock has seen a notable decline of 11.22%, while shorter-term returns such as one day (+0.22%), one week (+0.79%), one month (+0.71%), and three months (+0.50%) show modest positive movements. Year-to-date, the stock has gained 0.73%, but it has underperformed the broader BSE500 index, which has delivered a 5.35% return over the past year.
Technical Outlook: Mildly Bearish Signals
From a technical perspective, ABB India Ltd is currently rated as mildly bearish. This suggests that while the stock is not in a strong downtrend, there are some cautionary signals in price action and momentum indicators. Investors should be mindful of these technical factors when considering entry or exit points, as they may reflect short-term market sentiment and volatility.
Shareholding and Market Position
Promoters remain the majority shareholders of ABB India Ltd, providing stability in ownership and strategic direction. The company is classified as a large-cap stock within the Heavy Electrical Equipment sector, which typically offers exposure to infrastructure and industrial growth themes in India.
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What the Hold Rating Means for Investors
For investors, the 'Hold' rating on ABB India Ltd suggests a cautious approach. The company’s excellent quality metrics and strong long-term fundamentals provide a solid foundation, but the very expensive valuation and flat financial trend temper enthusiasm. The mildly bearish technical signals further advise prudence in timing new investments.
Investors currently holding ABB India Ltd shares may consider maintaining their positions while monitoring upcoming quarterly results and market developments closely. New investors might wait for more attractive valuation levels or clearer signs of financial improvement before committing fresh capital.
Overall, the 'Hold' rating reflects a balanced view that acknowledges ABB India Ltd’s strengths in profitability and capital efficiency, while recognising valuation concerns and recent performance challenges. This nuanced perspective helps investors make informed decisions aligned with their risk tolerance and investment horizon.
Summary
In summary, ABB India Ltd’s current 'Hold' rating by MarketsMOJO, updated on 18 Nov 2025, is supported by excellent quality fundamentals, a very expensive valuation, flat financial trends, and mildly bearish technicals as of 05 January 2026. The stock’s recent underperformance relative to the market and premium pricing suggest that investors should adopt a measured stance, balancing the company’s long-term strengths against near-term uncertainties.
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