Cyient bets on acquisitions to boost growth

For the September quarter, the Hyderabad-based company's revenue in US dollar terms rose 8.2% sequentially to $174.8 million, its highest quarterly revenue so far.

Written by Ayushman Baruah

November 11, 2022 00:30 IST

“The impact of these acquisitions is expected to be more visible in the year's second half,” Bodanapu said.

Mid-sized IT company Cyient is betting on acquisitions to boost growth as it aims to touch $250 million in quarterly revenue by the second half of the next fiscal. For the September quarter, the Hyderabad-based company’s revenue in US dollar terms rose 8.2% sequentially to $174.8 million, its highest quarterly revenue so far.

Cyient’s acquisitions strategy is centered around building engineering capabilities and expanding geographic footprint. “We have five service lines that we focus on including embedded software, digital, among others. And, there are a couple of industries where we believe a lot of transformation and transition is happening. We will look at areas like healthcare and automotive,” Krishna Bodanapu, MD and CEO, Cyient, told FE in an interview.

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In terms of geographies, he said Cyient is focusing on growing in Japan, India, and the Nordics. However, Bodanapu cautioned, “We may slow down our pace of acquisitions next year as there is a lot of time and effort on integration.”

Cyient has completed four new acquisitions this fiscal: Finland-based engineering firm Citec, Singapore-based consulting firm Grit Consulting, Portugal-based wireless engineering firm Celfinet, and Bengaluru-based startup Klaus IT Solutions. “The impact of these acquisitions is expected to be more visible in the year’s second half,” Bodanapu said.

Cyient has maintained its FY23 revenue growth guidance to be in the range of 13-15% in constant currency in organic terms. However, the company expects to add another 14-15% to its full-year revenue because of these acquisitions. In absolute terms, the acquisitions may add another $150 million annually to the company’s topline.

During the September quarter, Cyient won five large deals with a total contract potential of $105.2 million, of which four are from its services arm and one is from its design-led manufacturing business.

At the end of trading on Thursday, Cyient’s shares were down 0.07% to close at Rs 740.75 on the BSE.

This article was first uploaded on November eleven, twenty twenty-two, at thirty minutes past twelve in the am.