UPDATE 3-ABB Q2 net up 34 pct, profit-taking hits shares

(Adds conference call, analyst comment, updates shares)

By Katie Reid

ZURICH, July 24 (Reuters) - Swiss engineering group ABB (ABBN.VX: Quote, Profile, Research, Stock Buzz)(ABB.ST: Quote, Profile, Research, Stock Buzz) posted a 34 percent rise in second-quarter net profit and hiked its 2008 automation activities outlook, but shares slumped as traders looked to lock in profits.

Net profit rose to $975 million, the group said on Thursday, compared with the average estimate of $987 million in a Reuters poll of 22 analysts, as it benefited from rampant global power infrastructure demand.

But its shares had fallen 5.6 percent to 28.52 Swiss francs by 1118 GMT, underperforming a little changed Swiss blue-chip market.SSMI, and erasing gains from the previous session.

"Given the in-line results, despite the confident outlook, we expect to see some profit-taking today, in particular given its premium to the sector," UBS analyst Christel Monot said in a note.

ABB, which sells equipment to utilities as well as to oil and gas companies, is trading at 16.9 times expected 2008 earnings, according to Reuters data, at a premium to rival Schneider (SCHN.PA: Quote, Profile, Research, Stock Buzz), which is trading at 9.9 times.

The group raised its guidance for its automation activities to "clearly above 10 percent", having previously forecast growth of around 10 percent and reiterated that it sees growth of about 15 to 20 percent for its power-related activities.

ABB is benefiting as Europe and the United States are replacing ageing power systems, while rapid economic growth in emerging economies such as India and China requires heavy investment in power infrastructure.