Moneycontrol
Jul 14, 2017 03:51 PM IST | Source: Moneycontrol.com

Buy Cyient; target of Rs 600: Motilal Oswal

Motilal Oswal is bullish on Cyient has recommended buy rating on the stock with a target price of Rs 600 in its research report dated July 13, 2017

 
 
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Motilal Oswal's research report on Cyient

Rangsons (DLM) dragged performance vis -à- vis expectations on both revenues (3% impact) and  margins (60bp impact) front . Having started the year at  USD12m, the company maintained its  outlook of 20% growth , citing healthy visibility to reach  USD65m for the full  year (we estimate 12% growth). Operating loss of INR53m in DLM also  dragged the EBITDA margin by 50bp QoQ  to 12.8% v/s our estimate of 13.2%  (ex-DLM margin was 13.3%). PAT of  INR878m (+18.6% QoQ) came in below  our estimate of INR955m, led by operational miss. Also, the  reported tax rate  during the quarter was 31%, but 27% excluding one -offs.


Outlook


We see favorable risk-reward at 14.5/12.5x FY18/19E earnings. Our price target of INR600 discounts FY19E earnings by 14x. Buy.


For all recommendations report, click here


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