Buy Cyient, target price Rs 1585: Anand Rathi

Anand Rathi has buy call on Cyient with a target price of Rs 1585. The current market price of Cyient Ltd. is Rs 1181.
Time period given by analyst is one year when Cyient Ltd. price can reach defined target.

Cyient Ltd., incorporated in the year 1991, is a Mid Cap company (having a market cap of Rs 13063.48 Crore) operating in IT Software sector.


Cyient Ltd. key Products/Revenue Segments include Software Development Charges for the year ending 31-Mar-2020.


Financials
For the quarter ended 30-09-2021, the company reported a Consolidated Total Income of Rs 1126.50 Crore, up 3.93 % from last quarter Total Income of Rs 1083.90 Crore and up 11.25 % from last year same quarter Total Income of Rs 1012.60 Crore. Company reported net profit after tax of Rs 121.30 Crore in latest quarter.

Investment Rationale
The stock quotes at 22x FY23e EPS of Rs53, which seems attractive compared to the sector and to its FCF yield of ~4.1%. The brokerage retains a Buy with a higher target price of Rs1585 (30x FY23e EPS). Risks: Protracted recovery in A&D.

Promoter/FII Holdings
Promoters held 23.45 per cent stake in the company as of 30-Jun-2021, while FIIs owned 39.7 per cent, DIIs 19.94 per cent.