Semiconductor stock jumps after company to acquire 65% stake in semiconductor firm for $93 Mil

Synopsis: Cyient Ltd is to acquire a majority stake of over 65 percent in a US based semi-conductor company through its wholly owned subsidiary company for 93 million USD. 

The shares of this semiconductor company, majorly engaged in offering engineering, manufacturing, data analytics, and networks, as well as diversified operations across EMS, semiconductor and more, were in focus followed by a strategic acquisition of a player involved in the business of power semiconductors.

With the market capitalization of Rs. 12686 Crores, the shares of this company were trading at around 1145 which is 45  percent less from its 52 week high of Rs. 2086  and trading at a P/E of 22.5 whereas industry P/E stands at 29.8 

What is the NEWS: 

Cyient has approved the acquisition of a majority stake of over 65 percent in Kinetic Technologies, a US-based power semiconductor company, through its wholly owned subsidiary company Cyient Semiconductors Singapore. The total deal value can go upto 93 million USD and the transaction is expected to be completed by April 30,2026. 

Kinetic Technologies designs power management, analog, and mixed-signal integrated circuits (ICs) which helps in power conversion, protection, regulation, and signal conditioning. Its revenue has been volatile with 63 million USD in CY23, 37 million USD in CY24 and expected USD of 41 million in CY25. 

This deal will help Cyient to grow rapidly in AI and edge computing which requires advanced power and thermal management, expansion of data centres and electrification trends in automotive and industrial systems. 

Company analysis and financials: 

Cyient Group operates across multiple business segments, through Cyient DET, Cyient DLM, Cyient Semiconductors, and Cyient Others. Within Cyient DET, the business is organised into three core units: Transportation & Mobility, which covers aerospace, rail, and automotive; Networks & Infrastructure, focused on connectivity and utilities; and Strategic Units, which include mining and minerals, energy, healthcare, and life sciences.

Cyient Ltd is  majorly engaged in providing global technology services and solutions which is specialised in geospatial, engineering design, IT solutions and data analytics. The company’s services include digitisation of  drawings and maps, photogrammetry, CAD/CAE etc

Year on Year analysis: Revenue from operations has decreased from Rs.1849 Crores to Rs. 1781 Crores, down 3.6 percent. Operating income has decreased from Rs. 297 Crores to 214 Crores, down 28 percent and Its net income has decreased from 187 Crores to 143 Crores, down 23.5 percent 

Quarter on quarter analysis: Revenue from operations has increased on a quarter on quarter basis from Rs.1712 Crores to Rs. 1781 Crores, up 4 percent. Operating income has decreased from Rs. 228 Crores to 214 Crores, down 6 percent and Its net income has decreased from 157 Crores to 143 Crores, down 8 percent. 

Written By Vachan Kadli

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