Cyient DLM

Cyient DLM reported a robust start to FY27, with revenue growing 34.3% year-on-year to INR 373.8 crores. This growth was supported by a healthy order book and improved execution momentum across all business segments. EBITDA increased by 56.2% year-on-year to INR 39.2 crores, with the EBITDA margin expanding by 147 basis points to 10.5%. Profit after tax more than doubled, growing 118.2% year-on-year to INR 16.3 crores, reflecting a healthier business mix and disciplined cost management.

The company achieved its highest-ever order book, reaching INR 2,598.9 crores, an increase of INR 183.2 crores quarter-on-quarter. Order inflow for the period stood at INR 551.9 crores, resulting in a strong book-to-bill ratio of 1.5x. This robust order book provides excellent revenue visibility for the coming quarters and reaffirms customer confidence in Cyient DLM's capabilities, underscoring sustained demand across target markets.

Cyient DLM continued its strategy of diversification by adding two new logos in the industrial and automotive segments, broadening its customer base and reducing concentration. The company also expanded its build-to-specifications (B2S) lab from 6,000 square feet to 15,000 square feet, providing headroom for product platform development. Furthermore, the Mysore unit completed its Nadcap audit for cable harness assembly, reinforcing its credibility in high-reliability aerospace work.

The company is actively exploring new industry segments such as AI infrastructure, data center technologies, and robotics, which require high-reliability electronics manufacturing. Management indicated that these areas, along with semiconductor capital equipment, are expected to drive growth and margin leverage within the next 6 to 12 months. The strategy involves leveraging existing capabilities and selectively participating where a differentiated right to win can be established.

While the company reported strong growth, inventory days outstanding increased to 162 days in Q1 FY27 from 153 days in Q4 FY26, and net working capital days rose to 161 days from 145 days. This increase was attributed to higher inventory and lower customer advances, which resulted in negative free cash flow. Management clarified that this inventory build-up is a strategic move to ensure uninterrupted execution and support future growth, with expectations for cash flow to turn positive once inventory is controlled.

From an industry perspective, Aerospace and Industrial segments were the largest contributors to revenue, accounting for 42% and 32% respectively, with YoY growth of 40% and 90%. Defence contributed 9% with 35% YoY growth, while MedTech remained broadly flat at 16%. Geographically, 94% of revenue came from the Rest of the World, driven by demand from aerospace, medical, defence, and industrial customers outside India, with India contributing 6%.

Cyient DLM outlined a three-phase strategic roadmap: 'Strengthen' (current phase, 9-11% EBITDA margins), 'Expand' (FY27-FY29, targeting 11-13% EBITDA margins by entering robotics and AI data centers), and 'Transform' (FY30+, aiming for 13-18% EBITDA margins through B2S products and new platforms). This progression is designed to widen industry coverage and steadily elevate value delivery and margins over time^⏳.