Cyient DLM stock should increase due to a strong Q4 report and a "buy" rating from Motilal Oswal

Cyient DLM stock should increase due to a strong Q4 report and a "buy" rating from Motilal Oswal

The aerospace and defense (A&D) divisions drove Cyient DLM's strong performance in FY24. Significant A&D transactions make up a large amount of the order book and pipeline, and the business said that these deals would likely contribute to growth in FY25 and FY26.

Built on a 36,000 square foot production space, Cyient DLM's Bengaluru facility prioritizes meeting additional demand from current clients while also facilitating new business ventures and alliances. The Mysuru manufacturing plant will concentrate on expanding into important markets including the industrial and medical industries.

Cyient DLM's stock is probably going to start the day higher on April 24, the day after the business released strong quarterly results for the quarter that ended in March 2024. With strong support from the aerospace, med-tech, and defense industries, its sales increased by 30% year over year to Rs 361.84 crore, and its net profit (PAT) increased by 80% to Rs 22.7 crore.

Analysts at Motilal Oswal predict that Cyient DLM, an integrated EMS and solutions provider in the rapidly expanding critical end-user sectors, will take a piece of the market thanks to its strong core competencies and advanced technological skills.

For the whole fiscal year (FY24), the electric equipment firm recorded a robust 92.9 percent increase in PAT to Rs 61.2 crore. The company's EBITDA for FY24 was Rs 111 crore, with a 9.3 percent margin and a 26.5 percent year-over-year rise.

In FY24, the firm secured significant agreements and gained two new logos in A&D. It has a full plate of initiatives lined up for the next years. Additionally, the business opened two new locations in Bengaluru and Mysuru.

However, because of lumpiness in the order book conversion—which is anticipated to be converted in FY25—its order book dropped 11% YoY to Rs 2,170 crore.

With a healthy order book and solid connections with important customers, Cyient DLM said that its forecast for FY25 "continues to remain strong." Additionally, it said that it would consider using inorganic expansions to increase its global reach.

Cyient DLM is a division of Cyient, a provider of software services. Because of the company's robust order book and solid order inflows, excellent customer stickiness, and strong promoter history, Motilal Oswal anticipates that it will continue to thrive.

The firm maintained its 'buy' recommendation on the shares, with a target price of Rs 840, based on 38 times the FY26 EPS.

On the National Stock Exchange (NSE), Cyient DLM shares finished 2.87 percent higher on April 23 at Rs 689.00. In the last year, the stock has increased by 63 percent, while the benchmark Nifty 50 has increased by just 26 percent.