Midcap IT Stock Hits 52-Week High, Gave 575% Return In 3 Yrs, Gets Buy Rating For High Return

Broking firm Motilal Oswal has placed a Buy on Cyient Ltd. (CYL) with a target price of Rs. 1,450 apiece. According to the brokerage's given target price, the stock has the potential to give a decent return of 12% if purchased at the current market price. CYL is a Midcap IT Software sector company. It is a consulting-led, industry-centric, Global Technology Solutions company. The company has a market valuation of Rs. 14,312.28 crore.

Strong execution to sustain the performance, Buy for a target price of Rs. 1,450/share

According to the brokerage firm, CYL's service segment is shaping up quite well with the majority of its verticals gaining strength. This is majorly attributed to the demand recovery in the Aerospace segment and partly attributed to the inorganic investments.

"We expect near-term moderation of revenues due to the high base in Q4. However, we expect significant ramp-up in volume in the second half of the year to achieve the service revenue guidance (up 15-20% YoY CC) in FY24. The valuation is currently trading at 17x and 15x FY24E and FY25E (~40% discount to LTTS), giving us more comfort to assign a higher multiple of 17x (16x earlier) to its FY25E EPS with a target price of INR 1,450," the brokerage has said.

Stock Overview

The share price of CYL last traded at Rs. 1,299.75 apiece, up 0.96% from its previous close. It has given 7.5% positive return in 1 week. It jumped 21.62% in 1 month and 40.74% in 3 years, respectively. It has given 67.61% positive return. It has given 575.19% multibagger return in 3 years. In the past 5 years, it has given 63.75% positive return.

The stock traded its new 52 week high on 19 May 2023 at Rs. 1,318.05 apiece, while the 52 week low on 26 May 2022 at Rs. 720 apiece.

Disclaimer - The stock has been picked from the brokerage report of Motilal Oswal. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.