Siemens Share Price Gain 4% from Demerger Day

Siemens Ltd.’s shares saw a modest uptick of 0.50% on April 29, 2025, as of 3:06 PM. Despite this brief rise, the stock has been on a downward trend for most of the year, with a decline of approximately 14%. The company’s recent moves, including a key demerger, have had a significant impact on its stock dynamics.

The Demerger: Splitting Siemens Ltd.’s Energy Division

A landmark event occurred on April 15, 2025, when Siemens Ltd. allocated 35.6 crore equity shares in a 1:1 ratio as part of its demerger scheme. This strategic move separated Siemens Ltd.’s energy business, creating a new, standalone entity called Siemens Energy India Ltd.

The demerger took effect on April 7, 2025, aligning with the record and ex-date. On the ex-date, Siemens Ltd. experienced a dramatic intraday movement, with the stock hitting its upper circuit limit. This was part of a brief surge that saw a 26% increase. However, since the demerger, the stock has retraced somewhat, only managing a 4% gain from the close of April 7.

Read More: Siemens Energy India Share Allotment Done – When Is Listing?. 

Siemens Energy India: A New Energy Giant

Siemens Energy India Ltd. now operates as an independent entity, focusing on delivering comprehensive products, solutions, and services across the energy value chain. The portfolio of Siemens Energy India includes key segments such as grid technologies, industrial power generation, gas services, and project execution across power generation, transmission, and industrial applications.

This separation from Siemens Ltd. allows Siemens Energy India to hone its focus on the energy sector, enabling a more specialised approach to the growing needs of energy infrastructure development in India.

Financial Impact of the Demerger

Before the demerger, Siemens Ltd.’s energy vertical contributed significantly to its overall financials. Between the financial years 2021 and 2024, this segment contributed an average of 35% to Siemens Ltd.’s revenue and 40% to its earnings before interest and taxes (EBIT). The separation of this high-value segment has fundamentally altered Siemens Ltd.’s financial structure and its stock price dynamics.

Conclusion

The demerger of Siemens Ltd.’s energy business into Siemens Energy India marks a pivotal moment for both companies. While Siemens Ltd. faces a recalibration of its business model, Siemens Energy India is poised to grow as a dedicated energy powerhouse. The market’s reaction, characterised by an initial surge in Siemens Ltd.’s stock, reflects investor anticipation, though the stock has seen some retracement since the initial excitement. This move will likely continue to shape the market narrative for Siemens Ltd. and Siemens Energy India in the coming months.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.