Shares of Cyient Ltd. are trading with gains of 9% on Friday, October 23, after the company reported a stronger-than-expected performance in the second quarter of financial year 2027, with revenue and margins beating estimates.
The company’s revenue grew 6.8% quarter-on-quarter and 14.9% year-on-year, while constant-currency revenue growth stood at 15.3% year-on-year.
Cyient’s Digital, Engineering and Technology (DET) business reported revenue of $174.2 million, up 7.2% from $162.5 million a year earlier. Revenue growth stood at 7.5% in constant-currency terms, while organic constant-currency growth was 1.6%. Growth was driven by TAO Digital, following the consolidation of the business.
The DET business also reported its highest-ever order intake for a September quarter at $158.4 million, up 21% year-on-year. Its EBIT margin reached the highest level in 10 quarters.
The transportation and mobility business recorded its sixth consecutive quarter of growth, while TAO Digital made a healthy start following its consolidation, according to Kotak Institutional Equities.
Management remained positive about performance in the second half of FY27 and reiterated its commitment to strong execution. However, the company’s semiconductor business is now expected to break even in FY28, with the timeline deferred by a quarter or two.
Brokerage firm Kotak Institutional Equities has retained its ‘Add’ rating on Cyient, with a price target of ₹1,350.
The brokerage said the strong Q2 performance, record order intake at DET and improving margins supported its outlook. It has incorporated the TAO acquisition into its estimates and factored in the stronger Q2 FY27 performance, resulting in earnings estimate revisions of 5-12% for FY27-FY29.