Potential TI Spin-Off Increasing Likelihood of SGRE Spin-Off?

研报英文原文证据摘录

Potential TI Spin-Off Increasing Likelihood of SGRE Spin-Off?

strategy highlighted at the CMD to expand into new higher growth applications

and focus on capturing more of the installed base/fleet to improve the aftermarket share could

deliver more tangible benefits than expected.

Slightly improving and refocusing the remaining scope. TI generated €5.7bn in revenues

at 11% profit margins last year, employing 17k people, after a highly successful multi-year

transformation from a segment that was operating at breakeven margins at the time of the

spin-off in 2020 and went through a long period of cost savings, efficiency, and footprint

rationalisation. Within the segment, we believe the industrial steam turbines & generators

business remains attractive given the share of aftermarket, the installed base, synergies with

gas turbines (combined cycle vs. peers) as well as the exposure to the nuclear revival we

think compressor & hydrogen businesses are less attractive. Excluding the segment, Siemens

Energy could see ~100bps faster growth and ~40-60bps higher margins mid-term.

More credence to a separation of wind. The news comes after scrutiny on Siemens Gamesa

Renewable Energy (SGRE) with an activist investor taking a stake earlier this year pushing for

the renewed separation of wind, weighing on the profitability, valuation & capital allocation of

the group. Mgmt showing willingness to review the portfolio and take actions to unlock value is

clearly a positive sign and could increase the likelihood of a spin-off on Wind, once the onshore

segment is in a better shape. We are not aware of any comment from Siemens Energy on this

scenario.

Lucas Ferhani * | Equity Analyst

Not a surprise, and likely to be taken well.