Downgrades

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.

TechM’s turnaround efforts are yielding results with its BFSI portfolio strengthening, large logo additions, a stronger deal TCV run-rate and improvement in margins. Strong new deal TCV growth of 42.6% YoY provides some comfort on FY26 growth outlook.

Cyient reported weak operating performance in DET, in Q4. DET revenue degrew 3.0% QoQ (1.9% cc) to USD170mn. DET EBITM declined by 48bps QoQ to 13.0%, lower than our estimate.

PSYS reported a robust operating performance in Q4. Revenue growth of 4.5% QoQ CC was in-line, while EBITM of 15.6% was ahead of our estimate. Growth was predominantly led by BFSI and Hi-Tech while HLS stood flat.

We retain REDUCE on Nestlé India and Mar-26E TP of Rs2,300, on 60x P/E. We see demand stress persisting in a major part of the portfolio, with demand for milk products continuing to see impact of healthy price hikes (amid inflation) and competitive pressure in prepared dishes.

With an 8% upside from the CMP, we maintain HOLD

We maintain our BUY recommendation on the stock

Delivers industry leading growth in FY25 and in 4QFY25 and maintains its aspiration of US$2bn revenue by FY27 (20% CAGR)

4QFY25 sales were in line, but EBITDA 2% ahead of Bloomberg consensus

Revenue declined by 5% YoY (+30% QoQ) to ~Rs 41bn, as volume growth stunted and realisations fell despite slower volume gains