1. Opening Hook
Q3 FY26 for Cyient DLM felt like that awkward phase when the big defense order packed its bags, U.S. tariffs spooked everyone, and revenues decided to ghost the P&L. Naturally, management opened the call with confidence, optimism, and a polite reminder that “the worst is behind us.”
Revenue tanked, analysts panicked, but EBITDA margins casually stayed in double digits like nothing happened. Order book? Growing. Sales team? Beefed up. Tariffs? Apparently “handled.” M&A? Expensive lessons learned.
This was one of those calls where numbers looked ugly, commentary sounded bullish, and FY27 was presented like a Marvel post-credit scene. The real story wasn’t Q3—it was everything management promised would magically show up next quarter and beyond.
Stick around. It gets far more interesting once we decode the fine print.
2. At a Glance
- Revenue down 32% YoY – Large FY25 defense order exited stage left, took growth with it.
- Order intake ₹387 cr – Book-to-bill at 1.3, because hope is measured quarterly.
- Order book ₹2,350 cr – Third straight QoQ increase; backlog doing heavy lifting.
- EBITDA margin 10.2% (normalized) – Revenues collapsed, margins said “not today.”
- Reported PAT ₹112 cr – Down YoY, but margins quietly improved.
- Working capital worsened – Inventory piled up waiting for customers to decide life choices.
3. Management’s Key Commentary
“Our book-to-bill ratio is above 1 for the third consecutive quarter.”
(Orders are growing faster than revenue—classic EMS lag, but still comforting 😏)
“Revenue softness was due to holiday season and tariff-related uncertainty.”
(Customers paused shipments, not
confidence—please believe us)
“These push-outs are already on track to ship in the current quarter.”
(Everything bad conveniently moves to Q4)
“The margin profile across both revenues and order book has improved significantly.”
(Lower volumes, higher margins—mix finally behaving)
“Adjusted margins reflect one-time labor code and M&A expenses.”
(Margins are great if you ignore reality for a moment)
“We see strong traction in automotive, industrial and medical.”
(Defense dependency hangover cure in progress)
“Build-to-spec programs will meaningfully scale from FY28.”
(Wait two years, trust the process 😏)
4. Numbers Decoded
| Metric | Q3 FY26 | YoY Trend |
|---|---|---|
| Revenue | ₹303 cr | 🔻 31.7% |
| EBITDA (Normalized) | ₹309 mn | 🔻 14.4% |
| EBITDA Margin | 10.2% | 🔼 +207 bps |
| Reported EBITDA | ₹275 mn | 🔻 |
| PAT (Reported) | ₹112 mn | 🔻 |
| Order Book | ₹2,350 cr | 🔼 QoQ |
Decode: Revenue pain is real, but margin resilience is not accidental. Mix improvement + cost control are doing the heavy lifting while volumes catch their breath.
5. Analyst Questions
- Q4 revenue outlook?
Management confirmed YoY growth in Q4. (Finally, a clean sentence 😌) - Is order book growth driven by Altek (US unit)?
No. India business is leading the charge.
