Dear Shareholders,
The global economy continues to navigate through complex and turbulent
times, marked by persistent geopolitical tensions, varying paths of monetary policy
normalization across major economies, and evolving trade dynamics.
Despite these external headwinds, India's economy demonstrates
remarkable resilience and momentum. Our growth story is anchored in robust domestic
consumption, a strong investment cycle led by public and private capital expenditure and
continuing structural reforms. The scale of our digital public infrastructure and the
strengthening of the financial sector provide a strong foundation for sustained growth.
Manufacturing competitiveness is improving through focused initiatives like the Production
Linked Incentive (PLI) scheme, while the services sector continues to expand its global
footprint. The country's macroeconomic fundamentals remained sound, supported by stable
core inflation, healthy foreign exchange reserves and improving metrics such as fiscal
deficit and goods and services tax collections.
Against this backdrop, Siemens Limited businesses performed
commendably, as is evident in the Company's strong performance in New Orders, Revenue and
Net Profit.
Financial Performance - Highlights
For the financial year 2024, the Company received New Orders valued at
Rs 235,641 million, compared to Rs 463,829 million in the previous financial year -.
Excluding the large 9,000 HP electric locomotive order from Indian Railways received in
financial year 2023, New Orders rose by 14% in financial year 2024. The Order Backlog as
of September 30, 2024 stood at Rs 482,639 million. Sales (excluding other operating
revenues) were up by 14.4 percent to Rs 202,504 million, compared to Rs 177,007 million in
the previous financial year.
Profit from Operations stood at Rs 25,480 million compared to Rs 20,167
million in the previous financial year, an increase of 26.3 percent over the previous
financial year. The Company's Profit before Tax stood at Rs 35,177 million compared to Rs
25,451 million in the previous financial year, an increase of 38.2 percent. The Profit
after Tax for the financial year was Rs 26,651 million, an increase by 39.4 percent
compared to Rs 19,113 million in the previous financial year. The Board of Directors of
the Company has recommended a dividend of Rs 12/- per equity share of the face value of Rs
2/- each for the financial year ended September 30, 2024. The above financial performance
is for continuing operations.
Business Performance - Highlights
Among the key highlights during the financial year 2024, the Company
announced capex investments of approximately Rs 10 billion. This included Rs 4.6 billion
for its Power Transformer factory in Kalwa, Rs 1.9 billion to build a state-of-the-art
Metro train manufacturing facility at Aurangabad and Rs 3.3 billion for the Gas Insulated
Switchgear factory and Rs 560 million for the Vacuum Interrupter factory, both located in
Goa. These investments will enable the company to meet the growing demand both in India
and globally.
The Company secured numerous orders during the financial year. Among
the large orders, the Company received an order for the electrification of Bengaluru Metro
Phase 2 from Bangalore Metro Rail Corporation Limited (BMRCL) worth Rs 7.7 billion with
Siemens Limited's share as part of the consortium being approximately Rs 5.6 billion. It
is a matter of pride that the Company is involved in rail electrification for a
42-kilometer-long stretch on the Udhampur-Srinagar-Baramulla Rail Link, including the
longest rail tunnel on the Pir Panjal range at a height of approximately 1,700 meters
above sea level as well as to power India's first underwater Metro Rail connecting the
twin cities of Kolkata and Howrah.
The Company also won marquee projects, including the modernization and
upgradation of gas turbines for a leading oil exploration and production company, an EPC
substation construction project of 400 KV gas-insulated switchgear for a leading power
producer, 220 KV gas-insulated switchgear for a leading oil company and supply of a 400 KV
gas insulated switchgear product for a power company outside India as part of an export
order.
Technology Focus
Siemens Limited's positioning as a leading technology-focused company
is exemplified by its strong end-to-end portfolio of technologies for digital and
sustainable transformation, the rapid number of growing reference cases on Siemens
Xcelerator, the Company's open, evolving digital business platform and customer wins.
Siemens Xcelerator has over 200 reference cases many of these have
already been implemented. Stating some success stories of the platform: a food and
beverage company used a digital twin to deliver energy savings of over one million units
or over 30 percent. A leading automotive company saw a 20 percent improvement in
productivity and enhanced machine availability and performance using Industrial Edge, an
edge computing platform designed to improve industrial automation and data processing.
These are replicable solutions that can be scaled up within the enterprise and further
within the vertical and across verticals. Siemens Xcelerator provides customers with a
marketplace to select solutions and partners that best address their business challenges.
In addition to technology solutions that include Digital Enterprise
solutions, industrial edge, industrial cybersecurity, IT/OT integration, integrated
automation, AI (Artificial Intelligence) / ML (Machine Learning), etc., the Siemens
Xcelerator portfolio also includes offerings such as Building X, Electrification X, and
Gridscale X that help grid, urban and industrial infrastructure customers on their digital
transformation journey.
During the financial year 2024, the Company received orders from
several verticals such as renewables, metals, and food & beverage for cutting-edge
solutions in Additive Manufacturing, Industrial Edge, IT-OT (Information
Technology-Operational Technology) integration, Cybersecurity, and Digital Twin.
Sustainability
The Company's sustainability goals are defined under the holistic
DEGREE framework (Decarbonization, Ethics, Governance, Resource Efficiency, Equity,
Employability). Over 90% of Siemens' business enables customers to have a positive
sustainability impact along three value propositions: Decarbonization and Energy
efficiency, Resource efficiency and Circularity, and People centricity and Societal
impact. In financial year 2024, the Company has taken several measures to boost
sustainability in its own operations - the company added significantly to its share of
renewables.
Today, over 90 percent of the Company's energy consumption is from
renewable sources. Consequently, the company has reduced its emissions under Scope 1 and
Scope 2 to around 10 kilotons (a 67 percent reduction from the previous year). The company
is a power user of its own portfolio. From the introduction of e-buses with Siemens'
charging infrastructure to the use of Siemens' energy meters and software in GAVATAR, the
Company has used its own solutions to advance sustainability. Digitalization has enabled
the Electrical Product factory in Kalwa to improve its productivity by 30 percent and
increase the number of manufactured variants by three times.
When it comes to their people, the Company is committed to equity and
employability. The Company is committed to diversity and has a Gender Equity Program to
improve the participation of women in the workforce. The Company realizes that for
employees to stay relevant in a continuously changing work environment, they must embrace
lifelong learning. The Company's 'My Learning World' platform has a plethora of resources
across many topics to encourage the culture of learning. This learning platform is
available not only for employees but also for the Company's supply chain partners. In the
financial year 2024, the Company conducted several capacity-building workshops for the
supply chain partners to deepen their understanding of sustainability. The Company
demonstrated practical solutions including its offering to help suppliers advance on their
sustainability journeys.
The company has a robust governance mechanism. The Long-Term Incentives
of Senior Management are linked to key sustainability criteria (reduction in emissions and
digital learning hours). All employees are required to adhere to the Business Conduct
Guidelines (BCG) that outline ethical conduct in business and as a professional. An
extension of the BCG is the Supplier Code of Conduct for Third Parties and Intermediaries
that must be adhered to, by all suppliers at all times.
The Company continues to support its customers and helps them achieve
their sustainability goals. Several of the Company's customers have realized the benefits
of implementing technology solutions thereby advancing their sustainability goals. One of
the instances of tangible benefits is a globally-renowned hotel chain achieving around
6,600 MWh of energy savings, reducing carbon footprint by over 5,000 tons of CO2, and
optimizing 20 properties across India. The company through its work with Indian Railways
including electrification and signaling contributes significantly to People centricity and
societal impact.
I am glad to share that, thanks to these measures, the Company received
recognition from Business World magazine which ranked it second in the capital goods
sector.
Business Responsibility
The Company considers it as its economic, environmental, and social
responsibility to foster sustainable local development and add value to the local economy
in which it operates. The Company's CSR projects are long-term in nature and designed to
create sustainable value for society.
In the area of education, the Company has initiatives such as Dual VET
at (Industrial Training Institutes) ITIs that follow the German model of vocational
training and are implemented in partnership with Tata STRIVE; Indo-German Initiative for
Technical Education - IGnITE to promote technical trades and industry-specific in-plant
training at Government ITIs; Project Jigyaasa aimed at enhancing learning outcomes in STEM
(Science, Technology, Engineering and Mathematics) education for students in grades 7 to
10 in government schools; and Siemens Scholarship Program is a holistic development
program for bright engineering students from low socio-economic backgrounds to make them
industry ready.
During the financial year 2024, the Dual VET project benefitted nearly
53,000 trainees from 229 ITIs located in six states. The IGnITE project has benefitted
over 21,000 ITI trainees from 127 ITIs while Project Jigyaasa has benefitted 21,500
students and Siemens Scholarship Program supported 695 engineering students.
In the Social and Environment area, the Company's interventions as part
of Project Asha led to 125 hectares of soil and water conservation while 104 acres of land
have been made cultivable. The project has interventions in 31 villages in Jawhar block
and 28 villages in Mokhada block located in Palghar district of Maharashtra. The Company
also supported around 5,309 families (26,300 people) affected by Cyclone Remal in West
Bengal, floods in Manipur and Assam, landslides in Wayanad, and floods in Andhra Pradesh
with water, sanitation and hygiene kits.
Further details are elucidated in the CSR Report and Business
Responsibility and Sustainability Report.
People Excellence
The Company considers people as key contributors to its success. This
is emphasized through its focus on learning and development, well-being, innovation,
inclusivity, and enhancement of the workplace.
In tune with the requirement of technology solutions by its customers
and the increased emphasis on sustainability, the Company initiated strategic learning
initiatives such as digital learning labs in 19 of its factories, an Artificial
Intelligence Basecamp to encourage the adoption of AI and GenAI technologies at work,
capability building to support Siemens Xcelerator, "Learning in Sustainability"
session and "Acting in Sustainability" workshops. You would be glad to note that
following these workshops, multiple initiatives were planned to integrate sustainability
into the Company's operations and value chain.
The Company recorded 250,000 cumulative hours of learning during the
financial year - an increase of almost 10 percent over the previous financial year.
In terms of well-being, the Company has an ongoing 'We Care' program
that promotes physical and mental health, fosters open dialogue, and provides extensive
resources for its employees. Some of the continuing measures in this direction are
flexible mobile working policies, leadership support initiatives, and comprehensive health
and safety measures across its offices, factories, and project sites.
During the financial year 2024, the Company further reinforced its
commitment to a diverse, equitable, and inclusive (DEI) workplace. Notably, the Company
implemented the 4C approach — Commit, Connect, Collaborate, and Communicate — to
accelerate its DEI journey. During the financial year 2024, it launched initiatives such
as Diversity Talks, sustained initiatives as per the Gender Equity Program, organized
awareness and engagement sessions for occasions such as International Pride Month,
International Day Against Homophobia, Biphobia, Interphobia and Transphobia as well as
International Women's Day. To further build awareness, the Company introduced the DEI
playbook. In recognition of its various DEI initiatives, the Company received the Silver
Employer from the India Workplace Equality Index.
Outlook
India's $4 trillion economy is truly on the rise with strong macros
evident in the increased public capital expenditure, improved fiscal deficit, and higher
exports. The projected capex of Rs 11.1 trillion announced in Budget 2024 is 11 percent
higher than last year and a record amount for the country. As per data from Ministry of
Finance, Government of India, the fiscal deficit of 5.6 percent of GDP was better than the
previous estimate of 5.8 percent while exports were at $778 billion, which is a record
high.
As a nation, we are emerging stronger in almost every aspect. Private
sector capex is happening in diverse sectors that are contributing to India's growth
story. Together, all the concrete measures designed to make India an Atmanirbhar Bharat
are contributing to India becoming Viksit Bharat in 2047.
Technology is now imperative for India's economy to grow at the speed
and scale required to achieve the goal of being a developed nation in the next 20-plus
years. Technologies such as industrial AI, digital twin, IT/OT integration, etc. would
help increase the pace of setting up factories and their production, time-to-market of
products, and development of infrastructure. These technologies would also boost the
industry's efforts towards making their operations sustainable and meeting carbon emission
targets. Sustainability would be fundamental to India's growth and will also be a major
factor in public expenditure on infrastructure and private capex to improve resource and
energy efficiency, productivity, portfolio expansion, and capacity utilization, not least
due to the various regulations and India's commitment to COP 26.
Siemens Limited is well positioned with its comprehensive products and
solutions a strong emphasis on digital offerings, and continued focus on both private and
public sector capex, all of which support India's growth story. I am confident that the
Company - with its strong corporate governance, technology, products, and people - will
march forward in its successful, sustainable, and profitable growth journey.
The Company is focused on completing the demerger of the Energy
Business, announced during the financial year 2024. Siemens India and Siemens Energy India
Limited will both have a sharper business focus - creating two strong, independent
companies, focusing on their core activities, portfolios, and capital allocation. They
will have a stronger market focus. As independent entities, they will be able to execute
their strategy, with a tailored go-to-market and operational approach to leverage the full
potential of the Indian market. Finally, as two listed entities, Siemens Limited and
Siemens Energy India Limited will unlock the value of the energy business for the
shareholders through an independent, market-driven valuation. We expect the entire process
of demerger and listing to be completed in the calendar year 2025. Siemens Limited would
continue to be a leading technology company focused on industry, infrastructure, and
mobility.
In conclusion, I sincerely thank our shareholders, customers, the
board, the management, unions, and most importantly, the dedicated employees for their
consistent support and commitment to Siemens Limited during yet another challenging year.
Deepak S. Parekh Chairman