Cyient (532175) Q4 25/26 earnings summary

Executive summary

• Q4 FY26 saw revenue softness in the DET segment, with a 2.4% sequential decline in constant currency and a 1.5% year-on-year decline, but gross margin improved by 114 bps quarter-over-quarter.

• Group Q4 revenue was $209.9 million, up 0.9% sequentially but down 7.2% year-on-year; full-year group revenue was $820.8 million, a 4.3% decline in constant currency.

• Board approved a buyback of up to 6.4 million shares (5.76% of capital) at INR 1,125 per share, totaling INR 720 crore, with promoters not participating.

• Acquisition of Kinetic Technologies completed post year-end, strengthening the semiconductor product portfolio.

• Project Astro, a large M&A transaction, was paused due to AI evolution and geopolitical uncertainty, resulting in a significant one-time charge.

Financial highlights

• DET Q4 revenue: $163.5 million; EBIT margin: 12.4%; PAT: INR 138 crore, down 7.6% sequentially and 9.1% year-on-year.

• Group Q4 EBIT margin: 9.5%, down 277 bps year-on-year; group PAT: INR 534 crore for FY26, down 14.1% year-on-year.

• Free cash flow for DET in Q4: INR 2,255 million, with 163% PAT conversion.

• Exceptional items included M&A diligence expense (INR 712 million), labor code provision (INR 423 million), and impairment charges.

• Consolidated revenue for FY26 was INR 72,682 million, with consolidated net profit at INR 4,630 million.

Outlook and guidance

• FY27 guidance: mid- to high-single-digit organic growth, with margin aspiration to reach 15% EBIT by Q4 FY27.

• Strong order book momentum with a book-to-bill ratio above 1 in all quarters and 1.5x for the full year.

• Semiconductor business expected to reach $100 million revenue run rate in FY27, though margins will remain negative due to ongoing investments.

• Continued monitoring of regulatory changes, especially labor codes, with further accounting adjustments possible.