Hyderabad-based Cyient Limited's shares hit a new 52-week high on Monday, April 24, after the company reported better-than-expected net profits for the March quarter. The stock rose by 6 percent, taking its gains into the second consecutive day.
During Monday’s trade, the stock opened at a price of Rs. 1,164 per share against the previous close of Rs. 1,159.65 per share and grew further during the early trading session to touch a new 52-week high of Rs. 1,230.20.
It was trading at ₹1,197.85 apiece, up by 3.29 percent, at 11:05 a.m. on the NSE.
The stock touched a 52-week low of Rs. 720 on May 26, 2022, indicating that at the current level, the stock is trading over 66.36 percent above its 52-week low.
The stock has grown nearly 20 percent in the last one month. Moreover, in the past six months, it has yielded a return of 60 percent. The stock has gained almost 48 percent year-to-date.
The IT firm reported a 5.83 percent year-on-year (YoY) increase in its net profit for the March quarter at ₹163.20 crore compared to ₹154.20 crore in the same quarter last year. Excluding one-off expenses, the normalised profit rose 8.2 per cent YoY to ₹176 crore.
The company's earnings before interest and tax (EBIT) for the quarter jumped nearly 17 percent quarter-on-quarter (QoQ) to ₹249 crore, and saw a margin expansion of 106 basis points (bps) at 14.24 percent. The topline for the quarter stood at ₹1,758 crore, growing 3 percent QoQ and 6 percent YoY.
For the three months ending in March 2023, total services revenue was ₹1448.9 crores, a rise of 5% on a quarterly basis and 47.3 percent on an annual basis.
While the firm sees risk in the semi-conductor market, where a slowdown is anticipated, it forecasts consolidated services revenue growth in the range of 15-20 percent (YoY) on a constant currency basis for FY24.
Cyient aims to focus on the Indian market for the next 3-4 years. CEO Karthikeyan Natarajan shared in an interview with Financial Express that the company is looking to capitalize on the growth opportunities across different sectors like communications, transportation, medical, semiconductor, hi-tech, and automotive.
Domestic brokerage firm HDFC Securities is bullish on Cyient and has recommended a ‘buy’ rating on the stock with a target price of ₹1310, reported Moneycontrol.
Another brokerage, Motilal Oswal Financial Services, has a ‘buy’ call on Cyient with a target price of ₹1360.
Cyient Ltd., established in 1991, is a mid-cap company with a market capitalization of ₹13,265.36 crore that operates in the IT software industry. The company, through its subsidiaries in the United States, United Kingdom, Germany, Japan, Australia, Singapore and India, provides a range of services, including software product development, consulting, analytics and implementation.
According to a MintGenie poll, 15 analysts on an average have a ‘STRONG BUY’ call on the stock.