Capital Goods - Pan European: Higher voltage, higher growth

Research evidence excerpt

Capital Goods - Pan European: Higher voltage, higher growth

conversion and thermal SKUs (liquid cooling, batteries, MV switchgear, DC/DC Tore Fangmann >> Research Analyst

conversion and SSTs). Our modelling suggests this combination will add a 9-17pp annual Merrill Lynch (DIFC)

tailwind to addressable market growth for SU, ABB, SIE & ENR – on top of a 20% CAGR +971tore.fangmann@bofa.com4 425 8210

in data center GW deployments. By contrast, UPS, PDUs and parts of downstream LV Lorenzo Di Patrizi >>

distribution will lose relevance, especially negative for Legrand (-2pp pa growth impact). Research Analyst

MLI (UK)

+44 20 7995 7626

lorenzo.dipatrizi@bofa.comPower Conversion + Thermal > Distribution + Passive

We estimate 30/29/32/37% growth in the realistically addressable data center markets

for Schneider/ABB/Siemens/Siemens Energy Grid. Schneider will benefit from its strong

MV switch gear franchise, DC/DC, sidecar partnership and thermal exposure which more Exhibit 1: Lift POs for most of coverage

than offsets headwinds from a strong UPS franchise. ABB has a narrower opportunity, BofA Electricals rating and PO summary

with growth driven by strengthening demand for upstream electrical infrastructure (esp Rating PO (old)

MV switchgear) and exposure to SSTs, though it lacks thermal exposure. Siemens also ABB Neutral CHF88 (77)

benefits from higher-voltage electrification trends, although its addressable market Legrand U/P €118

Schneider Buy €330 (320)growth could be even higher if it had more exposure to cooling & downstream systems,

Siemens AG Buy €310 (300)

Siemens Energy benefits from SSTs, and has the highest CAGR since it currently only Siemens Energy Buy €260 (250)

sells HV transformers/switchgears/grid reliability products (STATCOM) to data centers.