On Friday, Cyient, an IT company, saw its shares fall by 22.8%. This big drop happened after the company’s CEO, Karthikeyan Natarajan, suddenly stepped down. He was a key leader in the company, and his exit raised worries about Cyient’s future.
Adding to the concern, Cyient lowered its predicted sales and growth following its third-quarter earnings report. This disappointing news shook investors and caused a sell-off that wiped out nearly a quarter of the company’s market value. By the end of the day, Cyient’s shares were priced at ₹1,355.
Sagar Shetty, a research analyst at StoxBox, explained that the company’s gloomy forecast is different from other IT firms, which did not face similar downgrades. Other companies like Tata Technologies and KPIT Technologies also saw their stocks drop, but only by a small amount. Mphai’s shares, on the other hand, rose by 3.2%, while Persistent Systems and Coforge increased slightly.
Motilal Oswal Financial Services changed its stance on Cyient’s stock from ‘Hold’ to ‘Sell’ and set a new target price of ₹1,350. They believe that slow growth in the upcoming quarter and the CEO’s departure might hurt the company’s earnings next year. Emkay Global, another financial group, also gave Cyient a lower rating and set a target price of ₹1,700, citing concerns over performance and future growth.
In 2024, Cyient’s shares have already dropped by nearly 20%, while the broader BSE 500 index has gone up by 14.5%. With ongoing uncertainties and more analysts lowering their ratings, Shetty thinks the stock price could fall even further.
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