The 27 reports from 8 analysts offering long term price targets for Cyient Ltd. have an average target of 554.33. The consensus estimate represents an upside of 39.10% from the last price of 398.50.
|Summary||Date||Stock||Broker||Price at Reco.||Target||Price at reco|
Change since reco(%)
|2019-10-25||Cyient Ltd.||Axis Direct||400.90||400.90 (-0.60%)||Neutral|
Cyient Ltd., one of the leading Engineering and Research and development services, company reported revenue growth of 6.4% QoQ and degrew by 2.4% on YoY basis at Rs. 1,158 crs. The EBITDA margin in Q2 FY20 has improved sequentially by 35bps to 13.8% from 13.2% in Q1FY20.
|2019-10-22||Cyient Ltd.||IDBI Capital||423.10||552.00||423.10 (-5.81%)||38.52||Buy|
CYL's Q2FY20 result was in-line with our forecast. Consolidated revenue grew by 4.9% QoQ in US$ but still lower YoY by ~3.8%. The QoQ growth was largely led by DLM (14.5% of revenue) which grew by ~28% QoQ. Services business (85.5% of revenue) continued to see muted growth of +1.8%/-3.8% QoQ/YoY. Consolidated EBIT margin...
|2019-10-18||Cyient Ltd.||HDFC Securities||448.10||485.00||448.10 (-11.07%)||21.71||Neutral|
Cyient is struggling with issues such as (1) Stress in services business, (2) Challenges in top accounts (3) Issues in core vertical (Aerospace and Communication), (4) Focus on lower margin DLM business, (5) Margin stress due to higher investments, and (6) Higher other income (~30% of PAT). There could be some recovery in performance (both revenue and margins) but concerns related to slowdown in decision making, accelerated trade war risks and higher mix of legacy services remain. Cash generation and collections have improved. We expect USD revenue growth of -0.4/6.9% and EBIT% of 10.4/10.7% for FY20/21E. The stock trades at reasonable valuation of 10.6x FY21E which is ~38% discount to LTTS. Risk to our thesis includes better US/Europe macro and INR depreciation. We maintain NEU on Cyient post in-line revenue and margin miss in 2QFY20. Growth challenges remain in core verticals and margin recovery is slow. We have lowered EPS est. by 1.2/1.4% for FY20/21E and our TP of Rs 485 is based on 11x Sep-21E EPS.
|2019-10-17||Cyient Ltd.||Motilal Oswal||447.65||600.00||447.65 (-10.98%)||50.56||Buy|
Our revised TP of INR600 discounts forward earnings by 12x, instead of 13x, due to expectations of a slower margin expansion and also the risk in longer- Revenue grew by 4.9% QoQ versus our estimate of +3.1% QoQ. Growth was soft in the verticals of Aerospace (-1.7% QoQ) and In the Services business, revenue declined by 15% sequentially from clients in the range of Top 6-10; also CYL lost two clients in USD5m+ category. Even though Q3 is seasonally weak, CYL expects growth in services businesses. This is because the expected uptick in margins from cost rationalization will likely be largely offset by external consultant fees in FY20. This is because the expected uptick in margins from cost rationalization will likely be largely offset by external consultant fees in FY20.
|2019-07-25||Cyient Ltd.||Chola Wealth Direct||486.95||530.00||486.95 (-18.16%)||33.00||Buy|
Chola Wealth Direct
Background: Cyient is a mid cap IT company with revenue of INR 46.2bn (FY20) specializing in engineering solutions, including product development and life cycle support, process, network & content engineering. In 1QFY20: revenue share from Americas (49.6%), Europe, Middle East, Africa (22.6%), and Asia Pacific (27.8%). Revenue share by business unit: Aerospace and Defense (36.4%), Transportation (11.7%), Semiconductor (5.0%), Medical & healthcare (3.3%), Utilities & Geospatial (13.5%), Communication (20.0%), I&ENR; (9.2%). Revenue contribution from Top 5 clients (31.8%), and Top 10 clients (43.0%), Total employees stood at 15,084....
|2019-07-23||Cyient Ltd.||Axis Direct||477.05||500.00||477.05 (-16.47%)||25.47||Neutral|
Cyient Ltd. reported weak results in terms of top line and on operating margins front in Q1FY20. Cyient posted degrowth in revenue of 5.2% on QoQ basis and 2.6%on YoY basis in constant currency (CC) terms for the period of Q1FY20 at $156.6 mn.
|2019-07-23||Cyient Ltd.||IDBI Capital||477.05||587.00||477.05 (-16.47%)||47.30||Buy|
CYL's Q1FY20 result was a miss across all parameters. Consolidated revenue declined by 5.2%/2.6% QoQ/YoY in US$. It was mainly impacted by the 6.1%/3.4% QoQ/YoY decline in the services business (88.1% of revenue). As a result, EBIT margin came off sharply by...
|2019-07-19||Cyient Ltd.||HDFC Securities||483.20||510.00||483.20 (-17.53%)||Target met||Neutral|
Cyient is struggling with issues such as (1) Deteriorating growth in services business, (2) Challenges in top accounts (3) Issues in core vertical (Aerospace and Communication), (4) Focus on lower margin DLM business, (5) Declining services margin due to higher investments, and (6) Higher other income (~30% of PAT). There could be some recovery in performance (both revenue and margins) but concerns related to slowdown in decision making, accelerated trade war risks and higher mix of legacy services remain. We expect USD revenue growth of 1.5/7.8% and EBIT% of 11.3% for FY20/21E. The stock trades at reasonable valuation of 11.9x FY21E which is ~31% discount to LTTS. Risk to our thesis includes improved US/Europe macro and INR depreciation. We maintain NEU on Cyient post weak 1QFY20. Given the huge miss in revenue and margins, we cut EPE estimate by 11.4/10.7% for FY20/21E. Our TP of Rs 510 is based on 11x Jun-21E EPS.
|2019-07-19||Cyient Ltd.||Reliance Securities||483.20||483.20 (-17.53%)|
|2019-07-19||Cyient Ltd.||ICICI Securities Limited||483.20||475.00||483.20 (-17.53%)||Target met||Hold|
ICICI Securities Limited
It was a disappointing start to the year with overall revenue decline of 5.2% QoQ. Issues in large clients in aerospace & defence (A&D;) segment and communication segment continue to linger on growth in the recent quarter as well. Further, inferior execution also supported the decline. Services segment witnessed a drag of 6.1% sequentially (-3.4% YoY) to US$137.9 million which could suggests bottoming out of revenue decline. However, a recovery in Q2FY20E and beyond needs to be watched. Still, taking into account the considerable miss in revenue in Q1FY20 and limited visibility...
|2019-07-18||Cyient Ltd.||Motilal Oswal||543.50||650.00||543.50 (-26.68%)||63.11||Buy|
18 July 2019 revenue declined 2.6% YoY to USD157m (6% miss), EBIT was down 2.5% YoY to INR1.0b (margin of 9.2%, 200bp miss) and PAT increased 9.5% YoY to than our estimate of USD20m. Sequentially, revenue declined in all but the smallest vertical in Services segment the decline was particularly pronounced in Communications (-9% QoQ) and E&U; (-12% QoQ). CYL had guided for Services revenue growth in high-single-digits and DLM revenue growth of 15% in FY20. On the Services front, it now needs a CQGR of 3.3% to get even to flat revenue YoY. It expects EBIT to grow in double- digits, which too is a stretch now, despite the cost-rationalization efforts. While 1Q was expected to be a weak quarter, CYL misread the recovery in A&D; and Communications, its two largest verticals (57% of revenues) that were expected to offset the anticipated weakness in other segments.
|2019-05-27||Cyient Ltd.||HDFC Securities||559.45||595.00||559.45 (-28.77%)||49.31||Neutral|
As much as 15% of US exports to China comprises aircraft. Hence, ongoing trade friction between US and China adds risk to Cyient's core vertical, Aerospace & Defense (34% of rev). Cyient's other key verticals like communications (-1.8% 4Qtr CQGR) can revive based on deal wins. Transportation will remain strong (2.2% 4-qtr CQGR; Cyient works for top-5 European rail cos). Cyient is struggling with issues such as (1) Single digit growth in services business, (2) Challenges in top accounts (3) Issues in core vertical (Aerospace & Defense), (4) Higher growth from the low margin DLM business (~4.0% in FY19), (5) Reducing scope of margin expansion in services due to higher investments, and (6) Higher other income (~22% of PAT vs. 11% for LTTS). We expect USD revenue/EPS CAGR of 8.6/8.8% over FY19-21E. The stock trades at 11.7x FY20E which is at ~50% discount to LTTS. This steep valuation gap will persist, given LTTS' higher growth, better margin profile and superior return ratios. Downgrade to NEUTRAL. Our TP of Rs 595 is based on 11.5x FY21E EPS. Cyient has lagged peers (ER&D;) in most parameters, viz. growth, margins and top accounts performance. Co grew 8.6% in FY19 (vs. 24.6% for peer co LTTS), top-5/10 accounts were down 2.2/1.7% YoY and EBITDA margin stood flat at 14% (vs 18% for LTTS). Cyients higher mix of mechanical engg services explains the slow growth and lower margin. According to Zinnov, Non-Digital ER&D; services (mostly mechanical) are expected to grow at just ~3% over the next five years.
|2019-05-13||Cyient Ltd.||IDBI Capital||570.90||672.00||570.90 (-30.20%)||68.63||Accumulate|
CYL also reiterated its S3 strategy, New Business Accelerators (NBA) program and its transformation into an end-to-end Tier-1 solutions provider to drive sustainable growth. It has higher focus across embedded software, connected assets, mechanical manufacturing and DLM for the same....
|2019-05-02||Cyient Ltd.||Axis Direct||595.60||695.00||595.60 (-33.09%)||74.40||Buy|
|2019-04-29||Cyient Ltd.||Chola Wealth Direct||580.90||717.00||580.90 (-31.40%)||79.92||Buy|
Chola Wealth Direct
Sector: IT /Mid-Cap | Earnings Update 4QFY19 Background: Cyient is a mid cap IT company with revenue of INR 46.2bn (FY19) specializing in engineering solutions, including product development and life cycle support, process, network & content engineering. In 4QFY19: revenue share from Americas (49.6%), Europe, Middle East, Africa (22.6%), and Asia Pacific (27.8%). Revenue share by business unit: Aerospace and Defense (36.4%), Transportation (11.7%), Semiconductor (5.0%), Medical & healthcare (3.3%), Utilities & Geospatial (13.5%), Communication (20.0%), I&ENR; (9.2%). Revenue contribution from Top 5 clients (31.8%), and Top 10 clients (43.0%), Total employees stood at 15,084....
|2019-04-26||Cyient Ltd.||HDFC Securities||580.90||725.00||580.90 (-31.40%)||81.93||Buy|
Cyient's growth engine is challenged given client specific issues. Large verticals, Aerospace and Communications are taking longer than expected to recover. Further margins expansion will be difficult considering investments required in the business and tight labour market. We expect USD revenue growth of 7.8/9.3% and EBITDA% of 14.0/14.2% for FY20/21E. The buyback of Rs 2bn is completed at an average price of Rs 640/share. Net Cash stands at Rs 7bn (~10% of Mcap). The stock trades at reasonable valuation of 12.4x FY20E which is ~49% discount to LTTS. Risks to our thesis include prolonged issue with top clients and slowdown in DLM. We maintain BUY on Cyient based on in-line 4QFY19. Given the single digit growth in services business, we cut P/E multiple to 14x vs. 16x earlier. Our TP Rs 725 is based on 14x FY21E EPS.
|2019-04-26||Cyient Ltd.||Kotak Securities||580.90||684.00||580.90 (-31.40%)||71.64||Buy|
Cyient Q4FY19 revenue de-grew by 0.3% QoQ in CC terms to USD 165.2 mn below our estimate. However, in FY19 revenue grew 10.1% YoY to US$660 mn in CC terms. In Q4FY19, Services revenue stood at $ 146.9 mn; growth of 1.7% QoQ (1.4% in CC), 2.9% YoY. On a consolidated basis, operating...
|2019-04-26||Cyient Ltd.||ICICI Securities Limited||580.90||620.00||580.90 (-31.40%)||Target met||Hold|
ICICI Securities Limited
Revenue growth expected to be more back ended FY19 services revenues were in single digits i.e. 7.6% vs. guided double digit growth at the start of the year & lower than the revised guidance (of 8.5%9.5%) in Q3FY19. This was mainly due to lack of talent availability and demand deferral by large client in the A&D; and communication segment. The company is addressing talent specific issues and has also incorporated risks on the demand front in providing guidance. The company also has a healthy book to bill ratio of 1.29x in Services and 1.07x in DLM business leading to overall book to bill ratio of 1.26x. As a result, the company expects...
|2019-04-25||Cyient Ltd.||Motilal Oswal||584.90||730.00||584.90 (-31.87%)||83.19||Buy|
25 April 2018 For FY19, CC revenue grew 10.1% YoY contributed by Services (88% of revenue) growth of 7.6% YoY CC and DLM growth 29.3% YoY (13% organic), EBITDA increased 17.3% YoY and net income rose 14% YoY. Including INR2b worth of buyback, the payout for FY19 stood at 82% of net profit. For 4QFY19, revenue was flat YoY (our INR1.25b). EBITDA margin expanded 30bp QoQ to 15.1%, in line with our estimate of 15.3%. EBITDA margin in Services was at 16.4% and in DLM at 4.1%. Significant net income beat was driven by INR521m of other income, which came outside forex and cash yield.
|2019-04-02||Cyient Ltd.||IDBI Capital||580.45||687.00||580.45 (-31.35%)||72.40||Accumulate|
Cyient (CYL) has cautioned about a weak Q4FY19, impacted by client specific issues in both services and DLM business. Thus it will miss its FY19 revenue guidance. The services business has seen deals for some of its key clients in Aerospace & Defense and Communications verticals (58% of services revenue) being deferred to FY20. While DLM business was impacted by delay in regulatory clearances for one of its client. We cut our consolidated revenue (in US$) and EPS forecast for FY19/20 by 2.1%/2.2% and 4.7%/4.8% respectively. We introduce FY21 financials and factor the impact of...