5 hours Ago
Target: ₹700 CMP: ₹515.70 Cyient DLM’s Q3-FY25 consolidated revenue/EBITDA grew by about 38/23 per cent y-o-y. However, EBITDA missed our estimates as margins declined 90 bps y-o-y due to a high mix of low-margin business (BEL order execution).
Standalone revenue (excl. Altek – recently acquired) grew only around 11 in Q3-FY25. The company maintains its guidance of a about 30 per cent revenue CAGR over the next three to five years; however, FY26 consolidated revenue growth would be in mid-teens due to the lack of BEL orders.
EBITDA margins may remain flat in FY25, with margin expansion expected after H1-FY26. Order book remains under pressure as consumption growth by major clients outpaces new order growth; however, management anticipates strong traction in the North American markets going ahead. Going ahead, we expect the growth momentum to slow down in the near term due to the lack of BEL orders and a delay in order flows from existing and new clients.
However, the integration of Altek, should drive healthy financial performance due to synergy benefits and industry tailwinds. For the medium to long term, the conversion of orders from new clients added over the last few quarters and ongoing discussions with some large global potential customers should boost growth visibility. Comments.
