Siemens "Path to Electrification & Automation pureplay" (Buy) Kukhnin

Research evidence excerpt

Siemens "Path to Electrification & Automation pureplay" (Buy) Kukhnin

ckwell Automation strong print (9% organic sales growth) and guidance raise to 5- 09/27E 12.62 12.76 1 12.26

9% growth (detailed read across report here) as well as end-markets outlook upgrade 09/28E 14.22 14.44 2 13.68

point to upside for DI (implying c10% organic sales growth vs cons 9%, UBSe 7%).

Andre Kukhnin

Analyst

Industry channel checks reassuring and support potential structural change andre.kukhnin@ubs.com

Over recent weeks we have undertaken a number of channel checks with the +44-20-7567 2162

Automation industry at events such as Hannover Messe (feedback here) and at another

Dini Magoon

industrial forum. We highlight the following key points: 1/ The current healthy demand Associate Analyst

trends for Industrial Automation may well already be supported by accelerating dini.magoon@ubs.com

adoption thanks to AI tools reducing the initial coding burden barrier; 2/ AI impact on +44-20-7567 4037

Industrial Software is likely to be nuanced with some areas seen as clear beneficiaries

Hemal Bhundia, CFA

(Simulation / CAE, EDA) while others are seen as more at threat (SCADA, Historian); 3/ Analyst

Industry participants’ and independent experts positive stance on Siemens’ capability hemal.bhundia@ubs.com

and investment focus in this space as well as potential for further structural change +44-20-7901 6515

given the recent management changes announcements (link, link), which is consistent

with Reuters’ recent article suggesting a potential split of DI and SI into 6-7 divisions.

Valuation

Siemens is trading on 2027E P/E of 21.3x and EV/EBITA of 15.8x with ex-SHL valuation at

around 17x EV/EBITA. We continue to find it attractive in light of its direct European