Recent Price Movement and Market Context
Siemens Ltd.’s share price has been under pressure over multiple time frames. In the past week, the stock declined by 3.51%, nearly double the Sensex’s fall of 1.73%. Over the last month, the stock’s loss widened to 8.65%, compared to the Sensex’s 3.24% decline. Year-to-date, Siemens shares have dropped 7.19%, again underperforming the benchmark’s 3.57% fall. The most striking underperformance is evident over the last year, where Siemens shares have plummeted 20.87%, while the Sensex gained 6.63%. This stark contrast highlights the stock’s relative weakness amid a generally positive market backdrop.
On the day of 20-Jan, Siemens shares touched an intraday low of ₹2,840, reflecting a 3.81% drop. The weighted average price indicates that a larger volume of shares traded closer to this low, signalling selling pressure. Furthermore, the stock is trading below all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — underscoring a bearish technical trend. The Capital Goods sector, to which Siemens belongs, also declined by 2.48%, indicating sector-wide challenges that may be weighing on the stock.
Investor participation appears to be waning, with delivery volumes on 19-Jan falling by nearly 41% compared to the five-day average. Despite this, liquidity remains adequate for sizeable trades, with the stock able to handle transactions worth approximately ₹2.05 crore based on recent average traded value.
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Fundamental Challenges and Valuation Concerns
Despite some positive attributes, such as a zero average debt-to-equity ratio and a healthy long-term operating profit growth rate of 18.56% annually, Siemens Ltd. faces significant headwinds. The company’s latest quarterly results for September 2025 revealed a 19.2% decline in profit after tax (PAT), which stood at ₹484.90 crore. This contraction in profitability is a key factor behind the stock’s recent weakness.
Moreover, the company’s return on equity (ROE) is 13.6%, but the stock commands a high price-to-book (P/B) ratio of 7.7, indicating a very expensive valuation relative to its book value. Although the stock trades at a discount compared to its peers’ historical averages, this premium valuation is difficult to justify amid falling profits and subdued market sentiment.
Over the past year, Siemens has generated a negative return of 20.87%, while its profits have declined by 18.2%. The price/earnings to growth (PEG) ratio stands at 1.4, suggesting that the stock’s price is not fully supported by its earnings growth prospects. This disconnect has contributed to the stock’s underperformance relative to the broader market and its sector peers.
In contrast, the broader BSE500 index has delivered a positive return of 4.98% over the same period, highlighting Siemens Ltd.’s relative weakness. This divergence may prompt investors to reassess their holdings in the stock, especially given the flat quarterly results and expensive valuation metrics.
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Outlook and Investor Considerations
Siemens Ltd.’s current share price decline reflects a combination of disappointing recent earnings, expensive valuation, and broader sector weakness. While the company benefits from a strong balance sheet and solid long-term operating profit growth, these positives have been overshadowed by falling quarterly profits and a lack of investor enthusiasm, as evidenced by declining delivery volumes.
Investors should weigh the stock’s premium valuation against its recent financial performance and market underperformance. The stock’s technical indicators suggest continued downward pressure in the near term, especially as it trades below all major moving averages. Given the significant divergence from benchmark returns and the company’s flat quarterly results, caution is warranted.
In summary, Siemens Ltd.’s share price is falling primarily due to weak profit growth, expensive valuation metrics, and underperformance relative to the broader market and its sector peers. These factors have combined to dampen investor sentiment and drive the recent decline in the stock price.
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