HDFC Securities is bullish on Cyient has recommended buy rating on the stock with a target price of Rs 850 in its research report dated October 18, 2018.
HDFC Securities' research report on Cyient
Cyient delivered strong performance in 2QFY19, both on the revenue and margin front. Revenue at USD 168.9mn was up 5.0% QoQ and 6.5% CC (higher than our est. of USD 166.6mn) led by strong DLM (14% of rev, +27% QoQ). Services (86% of rev, +3.5% QoQ CC) growth was in-line with expectations. Communication (+4.5% CQGR) & Transportation (+6.0% CQGR) are fueling growth while the largest vertical, Aerospace & Defence (+1.7%) growth will pick-up from 4QFY19E. Margin was up 151bps QoQ to 13.7% (higher than our est. of 13.3%), led by margin expansion in Services (+212bps QoQ) offset by DLM (-90 bps QoQ).
Outlook
Maintain BUY with a TP to Rs 850, implying 16x Sep-20 earnings.
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