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Informist, Monday, Jan. 27, 2025

 

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--Cyient MD: No risk to business, deals post CEO's resignation
--CONTEXT: Karthikeyna Natarajan resigned as Cyient CEO on Thu 
--Cyient MD: Started headhunting for new CEO 
--Cyient MD: New CEO may be appointed by March end 
--Cyient MD: Former CEO Natarajan remains with co as advisor 
--Cyient MD: Evaluating internal, external candidates for CEO post 
--Cyient MD: Team in place to see business continuity 
--Cyient MD: Optimistic on growth to come back FY26, have strong order book 
--Cyient MD: Jan-Mar revenue seen better, margins may see slight improvement 
--Cyient MD: Semiconductors business next big opportunity for co 

 

By Narayana Krishna

HYDERABAD – Cyient Ltd. is expected to appoint a new chief executive officer by Mar. 31, Krishna Bodanapu, managing director of the company told Informist. He added that the company has hired a head-hunting agency to evaluate prospective candidates, both internally and externally. This comes after the resignation of Karthikeyan Natarajan as the company's CEO on Thursday. 

 

"We are also looking at both internal and external candidates quite rigorously. We have also engaged with a headhunting firm which is going to help us evaluate (candidates), because we want to objectively evaluate both external and internal candidates. The new CEO is expected to join March-end," Bodanapu said in an interaction.

 

Besides Natarajan's exit from the firm, the company's disappointing December quarter earnings and reduction in the revenue growth guidance for 2024-25 (Apr-Mar) hammered the stock last week, which hit a 20-month low on Friday. At 1153 IST, Cyient's shares recovered and traded at INR 1,392.75, up 4%, on the National Stock Exchange.

 

"I don't see any risk of a deal loss or any risk of revenue loss as any significant challenge in that context," he said. Bodanapu said Natarajan's exit was his personal decision, and he remains with the company as an advisor to help in the transition.  

 

For the December quarter, Cyient reported a 32% on-quarter decline in its consolidated net profit to INR 1.22 billion, even as revenue rose 4.2% to INR 19.3 billion. On a year-on-year basis, the net profit fell 16.9%, while revenue increased 5.8%. Analysts had estimated the company's consolidated net profit at INR 1.74 billion.

 

Admitting that the Oct-Dec earnings were not its best in all respects, Bodanapu expressed optimism about better revenue performance in Jan-Mar, with margins expected to see slight improvement. The company is implementing additional operational measures, such as cost reductions, to enhance margins, he said.

 

Looking ahead, the Cyient MD said the company has a robust order book and a strong base which will drive growth in 2025-26 (Apr-Mar). He highlighted that special teams are focused on pursuing large deals while ensuring business continuity, with no anticipated disruptions amid the leadership transition process.

 

"There is a significant push on sales because where we are still lagging slightly is in our ability to win new business. We've done a lot of work on assembling the right sales team, incentivising them, and providing proper training," Bodanapu said.

 

He said there is a mismatch between market demand and the offerings of the sales team, which the company is actively addressing. Areas such as plant engineering and new energy will provide growth opportunities, while the semiconductor segment is set to become a major growth driver for the company going forward, the Cyient MD said.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Tanima Banerjee

 

 

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