ICICI Securities research report on Cyient
Cyient-DET reported a miss on revenue growth and margin in Q4, exiting FY25 with a full-year 3% YoY CC decline, steeper than its (-2.7%) guidance. Transportation vertical’s decline was cushioned by some traction in the aerospace sub-vertical and sustainability. Management is taking corrective measures aimed at simplifying company structure by: 1) spinning off the semiconductor business; 2) branching out the sustainability vertical; and 3) starting a new GCC dedicated business unit. With new management at the helm and prevailing economic uncertainties, these steps will likely take time to have any positive impact, potentially resulting in the recovery being pushed to FY27.
Outlook
We factor in 2.9% USD revenue decline in FY26 for DET business. Maintain HOLD with a Cyient DET (I-Sec) and DLM (consensus based)-combined SoTP-based TP of INR 1,190.
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