Cyient DLM shares tumble 13% as margins shrink and earnings pressure builds

Cyient DLM’s equity continued to slide, falling 13% to ₹783.55 in intraday trading and representing a 24% loss over the last two days. The downturn follows a Q2FY27 report that showed EBITDA margins contracting by 130 basis points to 8.7%, mainly due to increased sales-and-marketing expenses and ongoing product-development investment. Despite the margin pressure, the company posted a 26.5% year-on-year revenue increase, led by strong performance in its aerospace and industrial divisions.

Management attributed some execution challenges to supply-chain lead times and expects margin improvement through revenue growth and operating leverage. The firm’s three-stage strategy focuses on deepening core segments, expanding into AI data centres and robotics, and moving toward product- and IP-centric offerings, targeting long-term EBITDA margins of 13-18%. Analysts at PL Capital and ICICI Securities project continued revenue expansion and have raised their target price to ₹1,050, maintaining a buy recommendation.