ABB India Ltd is Rated Hold by MarketsMOJO

Current Rating and Its Significance

MarketsMOJO’s 'Hold' rating for ABB India Ltd indicates a balanced view of the stock’s prospects. It suggests that while the company demonstrates strong qualities in certain areas, there are valuation and technical considerations that temper enthusiasm for immediate buying. Investors are advised to maintain their positions but monitor developments closely, as the stock neither presents a compelling buy opportunity nor a strong sell signal at this time.

Quality Assessment: Strong Fundamentals Underpin Stability

As of 10 February 2026, ABB India Ltd exhibits excellent quality metrics. The company is characterised by robust long-term fundamentals, including a remarkable operating profit growth rate of 58.94% annually. This growth trajectory underscores the firm’s ability to expand its core operations effectively over time.

Additionally, ABB India Ltd maintains a low debt profile, with an average Debt to Equity ratio of zero, signalling a conservative capital structure that reduces financial risk. The company’s average Return on Capital Employed (ROCE) stands at an impressive 78.62%, reflecting high profitability relative to the capital invested. Such a strong ROCE is indicative of efficient management and a competitive business model within the heavy electrical equipment sector.

Valuation: Premium Pricing Reflects Market Expectations

Despite its quality credentials, ABB India Ltd is currently valued as very expensive. The stock trades at a Price to Book (P/B) ratio of 17.1, which is significantly higher than typical sector averages. This elevated valuation suggests that investors have high expectations for the company’s future earnings and growth potential.

The company’s Return on Equity (ROE) is 24.6%, a strong figure that supports the premium valuation to some extent. However, the Price/Earnings to Growth (PEG) ratio is notably high at 14.8, indicating that the stock’s price growth may be outpacing its earnings growth. This disparity warrants caution, as it implies limited margin for valuation expansion without commensurate earnings improvement.

Financial Trend: Recent Performance Shows Stability with Some Pressure

The latest financial data as of 10 February 2026 reveals a relatively flat trend in quarterly results. The Profit Before Tax excluding Other Income (PBT less OI) for the September 2025 quarter stood at ₹458 crore, reflecting a decline of 9.20% compared to previous periods. Similarly, the Profit After Tax (PAT) for the quarter was ₹408.76 crore, down by 7.2%.

While these figures indicate some short-term pressure on profitability, the company’s overall financial health remains stable. Over the past year, ABB India Ltd has delivered a total return of 4.59%, with profits rising by 4.7%. This modest growth aligns with the flat financial grade assigned by MarketsMOJO, suggesting that the company is maintaining its earnings base without significant acceleration or deterioration.

Technical Outlook: Mildly Bearish Signals Suggest Caution

From a technical perspective, ABB India Ltd’s stock exhibits a mildly bearish trend. This assessment reflects recent price movements and momentum indicators that suggest some downward pressure or consolidation in the near term. Despite this, the stock has shown resilience, with a one-month return of 14.54% and a three-month return of 16.82%, indicating that any bearish signals are tempered by underlying strength.

Investors should consider these technical factors alongside fundamental data when making decisions, as short-term price fluctuations may not fully capture the company’s long-term value proposition.

Market Position and Industry Context

ABB India Ltd is a large-cap leader in the heavy electrical equipment sector, with a market capitalisation of approximately ₹1,23,157 crore. It commands a significant 28.17% share of the sector, making it the largest company within this industry segment. The company’s annual sales of ₹13,010.65 crore represent 13.65% of the total industry sales, underscoring its dominant market presence.

Majority ownership rests with promoters, which often provides stability and alignment of interests with shareholders. This ownership structure can be a positive factor for long-term investors seeking governance consistency.

Implications for Investors

For investors, the 'Hold' rating on ABB India Ltd suggests a cautious approach. The company’s excellent quality metrics and strong market position provide a solid foundation, but the very expensive valuation and mildly bearish technical signals imply limited upside in the near term. Investors currently holding the stock may choose to maintain their positions, monitoring quarterly results and market developments closely.

New investors might consider waiting for a more attractive entry point, particularly if valuation multiples contract or if technical indicators improve. The flat financial trend and recent profit declines highlight the importance of vigilance in assessing the company’s earnings trajectory going forward.

Summary

In summary, ABB India Ltd’s current 'Hold' rating by MarketsMOJO, updated on 29 January 2026, reflects a balanced view of the stock’s prospects as of 10 February 2026. The company’s excellent quality and market leadership are offset by a very expensive valuation and cautious technical outlook. Investors should weigh these factors carefully, recognising that the stock offers stability but limited immediate growth potential under current conditions.

Key Metrics at a Glance (As of 10 February 2026)

• Mojo Score: 50.0 (Hold)
• Market Capitalisation: ₹1,23,157 crore
• Operating Profit Growth (Annual): 58.94%
• Debt to Equity Ratio (Average): 0.0
• Return on Capital Employed (Average): 78.62%
• Price to Book Value: 17.1
• Return on Equity: 24.6%
• PEG Ratio: 14.8
• 1-Year Stock Return: +4.59%
• Quarterly PBT less Other Income: ₹458 crore (-9.20%)
• Quarterly PAT: ₹408.76 crore (-7.2%)

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