Shares of ABB India climbed as much as 10% to Rs 7,923 on the BSE on Thursday before trimming some gains to trade around 7% higher after its global parent, ABB, reported a strong set of second-quarter results and disclosed robust order growth from the India region.
The key trigger for the rally was ABB Global's disclosure that order inflows from the India region surged 81% year-on-year during the June quarter, marking the strongest growth seen in several years. The India order inflow reported by ABB Global includes business from both its listed and unlisted entities in the country.
The strong order growth has raised expectations that ABB India could also report a healthy performance when it announces its own quarterly earnings. In recent quarters, the India order growth reported by the parent company has closely tracked the listed entity's order inflows.
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ABB Global results
Globally, ABB delivered better-than-expected operating performance for the second quarter. The maker of electrification and automation products used across factories, ports and ships reported operational earnings before interest, tax and amortisation (EBITA) of $1.93 billion for the three months ended June, a 20% increase from a year earlier. The figure was ahead of the company-compiled analyst consensus estimate of $1.88 billion.
Revenue for the quarter rose 14% year-on-year to $9.48 billion, broadly in line with market expectations. Net income increased 7% to $1.23 billion.
The company also reported a sharp increase in new orders, which jumped 30% year-on-year to $12.04 billion. ABB said demand continued to be supported by investments in data centres being built to cater to the growing requirements of artificial intelligence infrastructure.
The sharp acceleration in India order inflows, combined with the parent's strong global performance, was the key driver behind Thursday's rally in ABB India, as investors looked ahead to the company's own quarterly earnings for signs that the momentum in domestic order inflows has remained intact.
During the previous quarter, ABB Global reported 26% growth in India order inflows, while ABB India posted a 25% increase in its own orders. In the December quarter last year, the corresponding figures stood at 49% and 51%, respectively.
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ABB India share price performance
The optimism surrounding the India business lifted ABB India's shares sharply, making Thursday's rally the stock's biggest single-day gain since May 2024.
Trading activity in ABB India also picked up significantly. As many as 22.12 lakh shares had changed hands by early trade, far exceeding the stock's 20-day average trading volume of around 80,000 shares.
In the last six months, the stock has risen 58% and over 300% in the last five years.
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