Cyient hits a new low

about 5 months ago
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Cyient is the top loser on the BSE and it also went on to hit the 52-week low at Rs.475.10 and volumes showed an over 26 times surge.

The company’s earnings for Q1FY20 was very disappointing. It reported a 49% (QoQ) fall in net profit at Rs.90 crore on a 6.5% drop in revenue at Rs.1089 crore. Profit was primarily driven by lower EBIT and lower other income.

It recorded a dollar revenue of $ 156.6 million, down 5% (QoQ) and down 3% (YoY).

EBIT was down 30% at Rs.99 crore and the margins showed a sharp fall from 12.8% v/s 9.2%. The 180 bps fall in margin was on account of a one time impact of lower efficiencies (160 bps), lower absorption (142 bps), increased investment (58 bps), totaling to 360 bps, Forex impact (35 bps), hike impact (85 bps) offset by cost optimization program (130 bps).

Cash and cash equivalents was at Rs.821 crore.

Aerospace & Defense business unit had a de-growth of 0.1% QoQ and growth of 1.6% YoY driven by slowdown in business across two key clients. It expects the slowdown to be short term and the business to normalize towards the end of Q2. The Communications BU witnessed a de-growth of 10.3% QoQ and 17.0% YoY driven by decreased work volume across two key clients. The Transportation BU had a de-growth of 1.6% QoQ and growth of 2.8% YoY primarily driven by growth in rolling stock segment and new wins with key clients. Energy and Utilities witnessed a degrowth of 5.7% QoQ and 7.3% YoY driven by slowdown in key accounts.  Medical Technology and Healthcare (MT&H) business unit (BU) delivered a growth of 0.4% QoQ and 23% YoY driven by strong growth across both existing and new accounts.

Semiconductor BU witnessed a de-growth of 7.8% QoQ and 2.2% YoY primarily driven by low work volume from key clients.

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