India's Cyient posts Q1 profit drop on delays in project execution

Cyient

25/07/2024 12:34

BENGALURU, July 25 (Reuters) - India's Cyient  CYIE.NS  reported a drop in first-quarter profit on Thursday,
hurt by greater than expected delays in project execution.
    The company reported consolidated profit of 1.44 billion rupees ($17.2 million) in the quarter ended June 30, down
14.4% from last year.
    For further earnings highlights, click  urn:newsml:reuters.com:*:nFWN3JH1PB

    KEY CONTEXT
    Cyient reported a 0.6% decline in revenue due to challenges in the railway industry and its connectivity segment.
    Indian technology firms have grappled with sluggish demand through the last fiscal year as clients focused on
cutting costs in the face of high inflation and interest rates.
    Cyient's rival Tata Elxsi  TTEX.NS  reported a drop in quarterly profit as well, while L&T Technology Services'
 LTEH.NS  revenue missed estimates.
    However, companies in the technology sector, which like IT firms, earn a significant share of revenue from the
U.S., stand to benefit from increased client spending due to likely interest rate cuts in the world's biggest economy
later this year, according to analysts.
    
    PEER COMPARISON
                                     Valuation      Estimates (next 12           Analysts' sentiment          
                                     (next 12            months)                                              
                                      months)                                                                 
                      RIC          PE     EV/EBI  Revenue     Profit      Mean      # of      Stock to price  Div yield
                                          TDA     growth (%)  growth (%)  rating*   analysts  target**        (%)
 Cyient                CYIE.NS     23.19   13.75    10.60       13.26     Buy             17       0.86            1.62
 L&T Technology        LTEH.NS     37.79   24.78    10.07        8.69     Sell            27       1.15            0.98
 Services                                                                                                     
 KPIT Technologies     KPIE.NS     58.92   35.94    21.52       30.54     Buy             14       1.04            0.26
 Tata Elxsi            TTEX.NS     49.01   34.99    12.09       10.39     Sell            12       1.05            1.00
    * Mean of analysts' ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
    ** Ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is trading above
the PT
    
    APRIL-JUNE STOCK PERFORMANCE
    -- All data from LSEG
    -- $1 = 83.7140 Indian rupees

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 (Reporting by Varun Hebbalalu in Bengaluru; Editing by Varun H K)
 ((varunvyas.hebbalalu@thomsonreuters.com;))