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Cyient Q3 Results Review - Good Delivery, Improving Outlook: Motilal Oswal

The deal pipeline remains healthy, adding to confidence in management’s guidance of delivering better service revenue growth in Q4

<div class="paragraphs"><p>Cyient Ltd. (Source: Company website)</p></div>
Cyient Ltd. (Source: Company website)

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Motilal Oswal Report

Cyient Ltd. reported Q3 FY23 revenue growth of 13.4% QoQ in constant currency, largely coming through the full-quarter consolidation of Citec. Excluding the inorganic impact, its services business grew by 3.7% QoQ CC versus our estimates of 3.1% QoQ.

Design led manufacturing grew by 22.8% QoQ, beating our estimate of 18.1% QoQ growth.

Q3 growth was led by aerospace and defence, energy and utility verticals, up 10.2%, 5.8% and 4.6% QoQ, respectively. Communications remained muted. Rail/consulting stayed weak, declining 4.6%/7.8% QoQ. Management has maintained FY23 organic revenue growth guidance of 13-15% in CC terms.

The normalised Ebit margin stood at 12.9%, up 100 basis points QoQ, beating our estimate of 50 bp improvement. Cyient has maintained its FY23 Ebit margin guidance of 13-14%.

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Motilal Oswal Cyient Q3FY23 Results Review.pdf

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