On January 24, 2025, shares of Cyient Ltd. experienced a dramatic decline of approximately 19% after the company announced the resignation of its CEO, Karthikeyan Natarajan, and a downward revision of its revenue guidance for the fiscal year 2025.
Karthikeyan Natarajan has decided to step down as Executive Director and Chief Executive Officer of Cyient Limited effective immediately, noted the company’s release.
Meanwhile, Krishna Bodanapu, Executive Vice Chairman and Managing Director, has taken charge of the business’s operations for the interim. “We are grateful to Karthik for his contributions and commitment to the long-term success of the business, and we wish him the best in his future endeavors,” added Bodanapu.
Also, the technology services firm said that it expects DET revenue degrowth to be in the range of 2.7 percent on-year in constant currency (CC) terms from the previously expected steady performance. Also, the EBIT margin for Q4FY25 has been revised to 13.5 percent in comparison to the earlier 16 percent on account of the right shifting of revenue trajectory within the year.
At around 11:19 am, Cyient shares traded with a steep cut of over 18 percent or Rs 321.7 at Rs 1,431.1 per share on the BSE.
Cyient Q3FY25 print
For the review period, the company’s DET or Digital, Engineering, and Technology segment registered revenue of Rs 1,480 crore, marking a 2.1 percent sequential and on-year 0.8 percent degrowth.
Furthermore, in constant currency terms also revenue registered revenue growth of 2.4 per cent sequentially and 1.9 per cent on-year degrowth. Also, it recorded Rs 200 crore in EBIT, with a margin of 13.5 percent, while PAT declined 28.3 percent to Rs 124 crore in the December quarter.
Market Reaction And Analyst Downgrades
The stock market reacted sharply to these developments. Cyient’s shares fell to a 52-week low, reflecting a broader lack of investor confidence. Analysts have responded by cutting their earnings estimates and target prices for the company. For instance, Nuvama reduced its EPS estimates by 10.8% for FY25 and 4.5% for FY26, while JPMorgan downgraded the stock from “overweight” to “neutral,” lowering its target price from ₹2,300 to ₹1,750.
The consensus among analysts is cautious; many are concerned about Cyient’s ability to recover from this downturn. HDFC Institutional Equities noted that the combination of weak margins and leadership changes could hinder growth prospects in the near future.