Siemens AG is severely hit by global economic slowdown and its business catering to industrial and energy sector is at an all time low. The company's profit margin has been trailing its peers at around 9.5 percent, while its rivals namely Switzerland's ABB and U.S. based General Electric Co are faring much better with margins of over 10 percent and 15 percent respectively.

Sanjeev Zarbade, Vice President - private client group research, Kotak Securities said that, "The outlook for the Indian market is not positive right now for the industry. Profits are under pressure and cost cut measures are inevitable".

However, in the words of Amol Rao, an Equity Analyst who tracks the company at the brokerage firm Anand Rathi "Siemens India is not very lean, so some degree of downsizing would help the company improve efficiency. But the downsizing may not be as severe as it may be in other high-cost geographies. MNCs like GE, Siemens want to have a stronger base in India because it is low cost and offers a good market. Also, these are vibrant economies which have good long-term potential".

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