Reduce Cyient Ltd For Target Rs. 1,150 By Emkay Global Financial Services Ltd
Cyient Semiconductors, a wholly-owned subsidiary of Cyient, has signed a definitive agreement for acquiring majority stake exceeding 65% (with full control expected by the end of four years) in Kinetic Technologies—leader in power management as well as high-performance analog and mixed-signal ICs— for a total consideration of USD93mn (~3x P/S on CY24 basis vs median multiple of ~5x). The transaction is expected to be EBIT-accretive from FY27 and EPS-accretive from FY28. The acquisition aims to enhance Cyient's presence in power ICs for Edge AI and high-performance computing, and will thereby help it build India’s first ASIC-led custom power semiconductor company. The deal is set to more than double Cyient Semicon’s revenue, with Kinetic’s EBITDAM expected to log above the typical services margin over the medium term. We have not yet factored the acquisition into our earnings estimates, pending deal closure. We maintain REDUCE on Cyient, with TP of Rs1,150, valuing the DET business at 15x Sep-27E and the DLM business at 20% discount to the CMP
Deal details and structure Cyient Semiconductors Singapore Pte, a wholly-owned subsidiary of Cyient Semiconductors Private, has signed a definitive agreement for acquiring majority stake (exceeding 65%) in Kinetic Technologies—global leader in power management as well as high-performance analog and mixed-signal ICs—for a total consideration of up to USD93mn. The deal is valued at ~3x P/S on CY24 basis. The transaction is subject to customary closing conditions and is expected to be completed by 30-Apr-2026.
Acquisition to help Cyient build India’s first ASIC-led custom power semiconductor powerhouse The acquisition creates a scalable platform in the ~USD40bn power semiconductor market, accelerating Cyient’s growth across data centers, electrification, automotive, networking, industrial automation, and emerging edge AI. Backed by over 100 patents, Kinetic’s power and protection expertise will further expedite custom chip development and market expansion, thus positioning Cyient as a strong leader in high-growth markets.
Kinetic Technologies – Brief profile Founded in 2006 with headquarters in USA, Kinetic Technologies specializes in power management along with analog and mixed-signal ICs used for efficient power delivery and signal conditioning across the consumer, computing, edge AI, communications, industrial, automotive, and enterprise markets. Kinetic reported revenue of USD63/37mn in CY23/24, respectively, and expects to clock USD41mn revenue in CY25. Its top-10 clients contribute ~40% of the revenue
For More Emkay Global Financial Services Ltd Disclaimer http://www.emkayglobal.com/Uploads/disclaimer.pdf & SEBI Registration number is INH000000354
