Cyient DLM Ltd

- Currently, there is no immediate plan for debt or equity fundraising. - The company has utilized all IPO proceeds that were earmarked for acquisitions. - If new mergers and acquisitions (M&A) occur, additional fundraising would be considered. - The company is in a healthy cash position with no pressure to raise funds as of the latest quarter. - Future fundraising will depend on identifying the right strategic targets for acquisitions. - Management is adopting a "wait and watch" approach to evaluate suitable acquisition opportunities before deciding on any new capital raise.

- The company is utilizing IPO proceeds for working capital and capex, with about INR 40 crores allocated for capex for the rest of the year (Page 9). - Maintenance capex expected but no significant new factory or SMT line investments needed soon, as current operations have substantial unused capacity (Page 13). - Focus on factory automation and digitalization initiatives expected to be completed by year-end (Page 6). - Inorganic expansion strategy is active, aiming to enhance technology capabilities and geographic footprint to better serve customers; discussions and early-stage conversations with potential acquisition targets ongoing (Pages 6, 10, 11). - No current plans for immediate large capital investments beyond working capital and maintenance capex, but open to sizable acquisitions if strategically aligned (Pages 10, 15).

- Long-term growth expectation: 30% CAGR over 5 years, acknowledging some year-to-year volatility. - FY ‘26 outlook: Muted revenue growth due to large order completions and geopolitical disruptions, but stronger margin expansion. - Higher-quality revenue expected as new orders come with better margins. - Current capacity utilization at 55-60%; potential to nearly double revenue by running 3 shifts without major new CAPEX. - Order backlog increased with INR 515 crore new orders, half executable within current year, supporting revenue growth. - Industrial and Med-tech sectors gaining traction, aided by Altek acquisition, contributing to consistent and less volatile order inflows. - Domestic market shows higher growth potential than exports; already building a solid foundation domestically. - Book-to-bill ratio expected above 1 throughout the year, indicating sustained order intake growth. - B2S (build-to-spec) revenue contribution expected to grow gradually, reaching ~5% in FY ‘26. - Growth supported by ongoing sales team strengthening and digitalization/automation initiatives.

- Cyient DLM aims for a long-term revenue CAGR of around 30% over 5 years, though annual growth may vary due to business dynamics. - Margins are expected to improve, with a line of sight to reach early-to-mid teens EBITDA margins sustainably (12%-13%) within 2-3 years. - Q1 FY '26 EBITDA margin improved to 9%, with expectations for double-digit margins for the full year driven by better business mix and operating leverage. - Operating leverage benefits expected from increased capacity utilization (currently ~55-60%) and control over indirect costs, enabling margin expansion without large capital expenditure. - Profit After Tax (PAT) growth expected to improve with higher margins and stable costs. - Enhanced sales efforts and higher-margin order backlog contribute to confident margin improvement and profit growth trajectory. - Short term profit/margin impacted by noncash amortization and geopolitical supply chain disruptions but expected to normalize over the year.

- Current order backlog stands at approximately INR 2,100-2,138 crores, showing a quarter-on-quarter increase. - The backlog is well-balanced with around 40% Aerospace & Defense (A&D), 9% Defense, and the rest split equally between Industrial and Med-Tech segments. - Nearly 50% of the recent order intake of INR 515 crores in Q1 is executable within the current financial year. - Executability of the order book ranges between 18 to 24 months depending on customer schedules. - Book-to-bill ratio reached a high of 1.9 in recent quarters and is expected to remain above 1 throughout FY '26, indicating strong order inflow relative to billing. - The order intake has become more consistent and less volatile post-acquisition of Altek and with a pivot towards Industrial and Med-Tech segments. - The company is confident of sustaining the momentum in order intake and improving margin profiles going forward.