Shares of Cyient Ltd tumbled 20% in intraday trade on Friday to hit a 52-week low after the IT services firm’s chief executive officer and executive director Karthikeyan Natarajan resigned on January 23 and the company slashed its revenue growth guidance to -2.7% for the financial year 2024-25.

Net profit of Cyient’s DET (digital, engineering, and technology) segment fell 28.3% year-on-year to ₹124 crore for the quarter ended December 31, 2024 while revenue declined 0.8% to ₹1,480 crore.

“For FY25, we expect DET revenue degrowth to be in the range of 2.7% YoY in constant currency terms,” the company said in its outlook. Earnings before interest and tax (EBIT) stood at ₹200 crore, with a margin of 13.5% in Q3 FY25, largely due to by wage increases and currency headwinds. “We expect Q4 FY25 exit EBIT margin to be in the range of 13.5%, primarily due to right shifting of revenue trajectory within the year,” the company says.

Reacting to the developments, shares of Cyient plunged 20% to hit a 52-week low of ₹1,402.25 on the BSE. The stock opened at ₹1,621 against its previous closing price of ₹1,752 before hitting the lower circuit limit. The company’s market cap fell below ₹16,000 crore.

The board of the company appointed Debjani Ghosh as an independent director effective January 23, 2025 for a period of three years, subject to approval of the shareholders. Ghosh has a career spanning over 28 years in the technology industry. She became the first woman to lead Intel’s South Asia operations, and later making history as the first female President of NASSCOM.

Cyient, which announced a foray into chip design last year, said its semiconductor business continues to witness traction. The company secured approval from its board to explore additional capital raise options for its recently announced semiconductor subsidiary. “This aligns with our strategy for semiconductor business towards capital readiness and to drive accelerated growth in the near-medium term,” says Krishna Bodanapu, Executive Vice Chairman and Managing Director, Cyient. After Natarajan’s exit, Bodanapu has taken charge of the business's operations for the interim.

“We have expanded our partnership with Allegro Microsystems and established a Center of Excellence (CoE) at our Manikonda campus to develop next-generation magnetic sensors and power semiconductor products for the automotive industry. The CoE will be crucial in accelerating the development of power integrated circuit (IC) product portfolios, essential components in electric vehicles, advanced driver-assistance systems (ADAS), and other automotive applications. This development strengthens Cyient's position as a leading partner for companies seeking to develop and manufacture cutting-edge semiconductor products,” says Bodanapu.

“Our order book has witnessed a strong uptick. Order Intake for Q3, at $312.3 mn, is the highest ever for Cyient DET, with a QoQ growth of close to 100% and YoY growth of 5%. We have also won 13 large deals in DET business with a total contract potential of $234.5 mn in Q3 FY25. Our pipeline for the year has improved, with large deals contributing significantly to a strong pipeline, positioning us for sustainable growth in the medium term,” says Bodanapu.

Karthikeyan Natarajan

Cyient shares crash 20% after CEO resignation, revenue guidance cut