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Cyient's Chip Success Fuels Growth Amidst Sector Slump
24 Jul
Summary
- Semiconductor services pipeline exceeds $100 million.
- Transportation segment grew 14.8% year-over-year.
- EBIT margin target of 15% deferred to FY28.
Cyient Ltd. is experiencing strong momentum in its semiconductor services, boasting a pipeline that surpasses $100 million. The company has successfully introduced seven new G-powered chips, meeting the demand in AI data centers, telecom, and consumer electronics markets.
In the transportation and mobility sector, Cyient recorded a significant 14.8% year-over-year increase in constant currency. This growth is holistic, spanning aerospace, rail, and automotive segments, with each showing double-digit year-over-year expansion.
Despite these successes, the company's EBIT margin target of 15% has been postponed to the first half of FY28, attributed to slower-than-anticipated revenue growth. Additionally, the strategic units segment, particularly the energy business, has seen a decline, with expectations of continued softness. The semiconductor business is projected to reach breakeven in FY28.
Cyient maintained a healthy order book with a book-to-bill ratio over 1.5, supported by diverse revenue streams and consistent double-digit EBITDA margins. The company also completed a $30 million financing round to bolster its financial standing for future expansion.
