"ACQUISITIONS That Help Address Gaps In Our Design Capabilities.....INTEREST US"

Over the past five years, Cyient DLM (formerly Rangsons Electronics), a subsidiary of Cyient Limited, has rapidly expanded its footprint in the design-led manufacturing industry through strategic acquisitions. EFY’s Yashasvini Razdan interviewed Cyient’s CFO, Shrinivas Kulkarni, to explore the company’s inorganic growth strategy amidst shifting market dynamics over the past six months.

- Yashasvini Razdan

What is the strategy behind an acquisition?

Acquisitions are often undertaken to address strategic gaps and position the company more effectively. In many cases, an inorganic approach enables faster progress than organic growth. Cyient DLM actively seeks assets that align with its strategic goals and accelerate progress.

Our recent acquisition of Torrington-based Altek Electronics not only aligns with our operations but also introduces new capabilities. With North America as a key market, given the concentration of our customer base there, this acquisition strengthens our manufacturing presence in the region while facilitating business expansion and customer acquisition.

How do you think this acquisition will impact the revenue growth for Cyient DlM in Fy25?

The volatile nature of our industry prevents us from providing a yearly outlook, as a single deal can significantly alter projections. However, we are confident about achieving a 30% CAGR over a three- to five-year period.

Strong industry tailwinds, particularly the emphasis on manufacturing in India, underpin this confidence.

Inorganic growth supports this outlook, though it was not the primary driver of the Altek acquisition. The acquisition was driven by the capabilities it brings, access to new customers, diversification into industrial and medical sectors and ITAR certifications. With Cyient DLM’s legacy, we are seeing a lot of traction in aerospace and defence. The company we acquired generates 90% of its revenue from industrial and medical sectors, which fits well with our diversification strategy. These were the primary considerations and growth is more a sweetener on top of the other strategic considerations.

How does acquiring companies outside of india help in the push towards manufacturing in india?