Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Cyient Limited (NSE: CYIENT) Q4 2026 Earnings Call dated Apr. 23, 2026
Corporate Participants:
Krishna Bodhanapu — Executive Vice Chairman and Managing Director
Sukumal Banerjee — Executive Director and CEO
Srinivas Kulkarni — Chief Financial Officer
Analysts:
Bhavik Mehta — Analyst
Madhur Rathi — Analyst
Presentation:
Operator
It. Sam. Sa. It. It. It. Sa. Good evening ladies and gentlemen, you are connected to the Science Limited conference call. Please stay connected. This conference is expected to begin shortly. We thank you for your patience. Ladies and gentlemen, you are connected to the Science Limited earnings conference call. Please stay connected. This conference will begin shortly. We thank you for your patience. It. Sam. Sa. It. Sa. Sam. Ladies and gentlemen, good day and welcome to the Scient Limited Q4FY26 results conference call.
As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing Star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Krishna Bodhanapu, executive Vice Chairman and Managing Director. Thank you. And over to you sir.
Krishna Bodhanapu — Executive Vice Chairman and Managing Director
Thank you, Darwin. Good evening ladies and gentlemen and welcome to Science Limited’s earnings call for the fourth quarter of financial year 2026. I’m Krishna Bodhanapoop, Executive Vice Chairman and Managing Director and present with me on this call are Sukumal Banerjee, Executive Director and CEO Srinivas Kulkarni, President and CFO and Prabhakaratla, President and Chief Operating Officer. As you know, Prabhakar was also the outgoing CFO and was the CFO for the financial year 2026. I would like to mention that some of the statements made in today’s discussions may be forward looking in nature and may involve risks and uncertainties.
A detailed statement in this regard is available in our Investor Update which has been emailed to you and is also posted on our corporate website. This call will be accompanied by an earnings call presentation, the details of which have already been shared with you. Before we begin, I would like to thank Mr. Prabhakaratla for his stewardship as CFO and wish him well as he steps into his new role as the Chief Operating Officer. I also would like to welcome Srinivas Kulkarni as our incoming CFO and to look forward to his leadership in taking our finance strategy and function forward.
I’m very happy that these two are among the most important roles in any organization and I’m pleased that Prabhakar and Srini are in these roles as we go forward and as we enter into a very exciting phase of Science Next orbit. At the beginning of this financial year, we have been reporting four groups for performance, four segments. Sorry for performance. These are det which excludes our semiconductor business, Scient dlm, our manufacturing business, Science Semiconductor, our semiconductor business and others.
The focus of this call will remain the DET segment and to that extent all numbers from DET segment are like to like to the previous period which basically means that these numbers are restated to exclude our semiconductor business and the group numbers will include performance of all four segments. While Sukumal will take you through the details of DET performance, I’d like to give you a quick update on some of the highlights across the group on semiconductor. As we complete a year of carving out the semiconductor business, I’m proud to say that we stand as India’s largest customs chip company today.
We have a clear focus on owning intellectual property and providing differentiated chips. This year has been a year of building revenue momentum, building intellectual property partnerships and of course a world class team has been put together. In Q4 we delivered $7.2 million in revenue of 5% sequential improvement and our fourth consecutive quarter of quarter on quarter growth in this particular segment continuing the trajectory from 5.5 million in Q1 and our full year revenue stood at $275 million.
Of course we had a negative EBIT for Q4 which now stands which stood at 2.8 million. But this is because we continue to build a strong team for sales, product management and have been creating some very strong IP. Some key highlights for Q4 we successfully closed 74% majority stake in Kinetic Technologies. We’re building proprietary strength in product and power products, we continue to scale our turnkey ASIC business and of course we won the mighty backed Semiconductor complex of India Limited FAB modernization program which will start later this quarter or early next quarter quarter.
I’m also pleased to announce that the Board has agreed in principle to explore a fundraise in the market in a combination of debt and equity. Given the growth in the semiconductor business and the working capital needs of the business, we have started engaging with various bankers and will come back with the final details once approved. I just want to repeat that this is for the semiconductor business which is a standalone business and the step down subsidiary of Science Limited. Looking forward as we enter into FY27 we have a very strong foundation, a great team and a great organization.
We will focus on this business and I’m sure there is a very strong growth path ahead for Science Semiconductor. If I may just take a minute on Scion dlm. As you know, Scion DLM is also a publicly traded company. So the board of Scion DLM made earlier this week to consider their results. While revenue was a bit muted on that Sector. I’m pleased to say that book to bill ratio for the year was at 1.5x. We’re now exiting or entering into FY27 with the highest order book in signed DLM’s history, which means that we will deliver a very strong year in FY27.
Also, profitability for the year was 10.3% which means that we’re able to sustain double digit profitability which is because we’re focusing on the right segments. We’re investing in operational excellence and maintaining cost and execution discipline. We enter FY27 in Scion DLM with a healthy order book, a mature pipeline and of course a very strong leadership team to execute to our plan there. I also am pleased to announce that in the meeting that was done that just concluded earlier, the Board of Directors has approved a proposal to buy back up to 6.4 million equity shares of the company.
This 6.4 million equity shares translates to a maximum of 5.76% of the total paid up capital from the shareholders through a tender offer at a price of 1125 per equity share for an aggregate consideration not exceeding 720 crores. I’ll repeat, we will buy back shares at 1125 per equity share up to 720 crores. The buyback of course is subject to shareholder approval and will be carried out along the lines of SEBI guidelines. I also want to say that the promoters, the members of the promoter family, members of the Board of directors, key management personnel have all indicated our offer not to participate in this buyback.
This reflects our long term conviction in the company’s intrinsic value and the strategic direction and ensures that the full benefit of the buyback accrues to the shareholders. The Board’s decision is underpinned that the current market price does not adequately reflect the underlying fundamentals and intrinsic worth of the business. Given this disconnect, the buyback represents an efficient and disciplined deployment of capital aimed at creating and enhancing long term shareholder value. The one time capital allocation measure does not reflect any change in our long term strategy or or signal limited growth opportunities.
Our pipeline is healthy, our M and A funnel is active and we are very well capitalized to deliver on our execution and strategic roadmap. Our focus on sustainable growth, balance sheet discipline and long term shareholder value creation remains firmly on course. The interim dividend of rupees sixteen declared at the Q2 board meeting shall be treated as final dividend for the financial year. I also want to reiterate that the Board has asked us to continue to stick with the 40 to 50% payback, which is what has been given back to shareholders every year.
And this will now happen not just through dividend, but through the right combination of dividend and buyback. Before I close, I would also like to mention Project Astronomy. Project Astro is a strategic transformation acquisition that we were looking at. And this was a transaction that would have brought us, brought in a step change in both scale and scope of our DET business. We ran a thorough and structured due diligence process. Financial, legal, commercial operations. And the process gave us confidence of the quality of asset that was available.
Having completed our diligence, we found ourselves at the point of commitment. Over the last couple of months, as we know, two things have happened. One, how rapidly AI has evolved and the impact that it has on the sectors that we operate in. We felt it’s important to step back and think through what this means for a business like the one that we were trying to acquire. We are quite confident on what it means for this core science business. But given that this is a new business, we wanted to step back and think about what it means for this business simultaneously.
And as you know, the geopolitical uncertainty that emerged around the same time gave us more reason to be conscious with the kind of instability we are seeing globally. Along with the advent of some of the AI stuff. We felt it was prudent to wait for things to settle down before committing to an investment of this scale. Of course, both these issues carry their own gravitas and require a serious deliberation. We have therefore made a conscious decision not to walk away, but to cross this transaction and come back with a more educated decision in the coming quarters.
The reason why I’m bringing this up is there is a large charge against our P and L this quarter which relates to Project Astro and the cost of all the diligence. The number is quite large, which is a reflection both of the size, the strategic nature of the transaction and of course it was a complicated transaction, which is why the cost of diligence was as high as it will be. But I just want to reiterate that we just have taken a pause and if we go ahead, the marginal cost will be very little. So that decision will be made in due course.
With this, I will hand over the call to Sukumal who will take us through the business performance of BEP for Q4 and FY36.
Sukumal Banerjee — Executive Director and CEO
Thank you, Krishna. Good evening ladies and gentlemen, and thank you for joining us today. A year ago at the FY25 Q4 results call, I had been six weeks into the role. We committed then to use FY26 to build strength and stability back into the business, reassess where we play, turn our technology investments in digital and AI into engines of growth and re energize the organization with the right leadership. Year on Let me report back on where the business stands. The clearest forward indicator we have is order intake and H2 is where the year turned.
H2 came in meaningfully higher than H1 so our H2 year over year booking was 5.5% in terms of order intake value. We secured a multi year framework agreement with leading global rail OEM on signaling and systems integration where we are selected as one of the three strategic suppliers in a consolidation process across global vendors. We won a supplier consolidation engagement with a mid sized global aerospace airframe manufacturer replacing incumbent vendors and consolidating delivery with sign a multi year network design and infrastructure engagement with a leading global telecom operator strengthening Cyant’s role as a strategic engineering partner.
Our US based communications company awarded signed a multi year contract covering the full network engine lifecycle. We won a three year renewal and a scope expansion with an EMEA based communication service provider covering radio planning, network performance, EMS management and network availability services. Last quarter I had shared examples of our wins in technology that is Digital and AI and this quarter I share progress that we continue to make progress in our core markets and service areas as well.
Some of our existing customers have also backed us on price increases this year. That is one of the clearest markers of strength of our relationships and the values that we bring to those engagements. Turning to numbers, we entered Q4 with Momentum. However, a shift in some clients budget deployments created a downward variance against the visibility we had set at the beginning of the quarter leading to a degrowth of 2.4% quarter over quarter in constant currency, 2.1% in USD and 0.8% growth in INR terms.
This in year over year terms for Q4 had a minus 1.5% constant currency, 1.4% growth in USD and a 7.4% growth in INR. The revenue stood at 163.5 million USD with normalized EBIT of 12.4%. In absolute terms that was a 0.4% quarter over quarter growth for EBIT. The current geopolitical situation did have an effect as well with some deals in West Asia in our energy business being pushed out and we expect that impact to continue in Q1 FY27 as well. We have planned for IT and the mitigations are already underway.
We acknowledge that there were some temporary gaps in what I will consider a predictable and stable business. I want also to categorically communicate that these were not structural to the business demand or our value proposition in the market. We are confident on rebounding quickly. On the positive side, quarter over quarter Gross margin improved by 114bps annually. North America grew 5.5% year over year and APAC grew 3.3% year over year. Transportation and mobility cluster for US grew 4.5% quarter over quarter and for the full year an impressive 13.2% year over year in constant currency.
This reflects our clear industry leadership, our domain strength and the ability to work across the entire lifecycle of products, especially in aerospace. Leveraging the current volume surge and hence creating a durable growth environment for us. Network and infrastructure saw a decline of 3.6% quarter over quarter and a full year decline of 1.6% year over year in this segment. Connectivity that is is where we are seeing the most structural shift. Our position in autonomous network is differentiated built on our engineering domain knowledge, platform, IP and partnerships and this is where the next wave of client investments is headed.
Alongside that, our continued fiber build out spend in North America and EMEA is expected to be sustained for the next three to five years. Some of our largest customers have already announced hundreds of billions of dollars of network expansion plans for the next five years. What is changing across both is the nature of the spending itself. It is becoming longer in horizon, transformative in its ask, leveraging AI, larger in scale. All that plays directly into our strengths. Our strategic units indicate a degrowth of 12.4% quarter over quarter and a full year degrowth of 12.2% year over year.
While the headline numbers look sharp, we have taken a set of actions on how we turn this cluster around. While the time taken to turn around as I had indicated earlier as well will be a few quarters, we don’t feel this will hamper our ambitions for our next fi as you will continue to see moderation in these numbers downwards. On the AI and digital side we are rolling out Science Engineering Intelligence platform to codify fragmented engineering data workflows and domain intelligence spanning CAD, SBOMs, PLMs, CADA and ERP into a coherent agent driven foundation.
The real value is getting delivered through the industry playbooks built on top of it. These playbooks, spanning aftermarkets, CARA or quality and regulatory authorizations and AI enabled engineering define what outcomes are delivered and how the platform can run within clients environment, the customer’s environment or a hybrid model because what ultimately matters is the consistent application of codified industry knowledge through trained agents to deliver measurable business results. Hajot Atri, our Chief Business Officer for Strategic Initiatives who I introduced last quarter as a new addition in the leadership team, is scaling this service line as a new growth engine for siem.
On that note, I want to also take a moment to talk about recent leadership appointments. As Krishna mentioned, Srinivas Kulkarni has taken over as Chief Financial Officer, driving our financial strategy and a sharper focus on capital discipline, capital allocation and margin expansion. Prabhakaratla, who served his tenure as the Chief Financial Officer, transitioned to be the new Chief Operating Officer as on April 1st with a mandate to strengthen the foundation, transform our core service lines and scale best in class delivery models.
Rajkumar Ravindranathan joined us, or as we fondly call him, Raj as the Chief Growth Officer in February, bringing 25 years of experience in scaling engineering, digital and AI and IT businesses. He leads growth growth across energy, automotive and mobility, health and life sciences and mining along with focused regional units in India, Japan and Middle East. With clear mandate to drive large deals and grow strategic markets. We are building to be a more integrated, more relevant and more valuable engineering lifecycle partner for our customers.
Our strength has always been domain expertise and and that ndos what changes is how we carry it forward. The company that will win in our sector are the ones that layer AI and digital on top of deep domain knowledge and the human expertise. That is exactly what we are building towards. With that, let me invite our new CFO Srinivas Kulkarni to present a more detailed view of our financials.
Srinivas Kulkarni — Chief Financial Officer
Thank you Sukumal Ladies and gentlemen, thank you for joining this morning’s call today. I will now walk you through the financials for Q4 and for the full year FY26. Before we review the numbers, I want to confirm that the consolidation structure remains unchanged comprising of four operating units, det, DLM Semiconductor and others. The focus of this call will be det. I will begin with the det segment covering Q4 and full year performance followed by the group level numbers. DET financials are presented on a like to like basis excluding the semiconductor business from FY25.
I will also highlight the exceptional items as we walk through the results. Coming to the det performance for Q4FY26 DET reported a revenue of $163.5 million representing a 2.4% sequential decline in constant currency and a 1.5% year on year decline in constant currency in INR revenue was 1500 crores reflecting growth of 0.8% quarter on quarter and 7.4% year on year driven by favorable currency tailwinds. DET delivered meaningful gross margin expansion in Q4 reaching 38.9% 114 basis point sequential improvement, operational efficiencies and favorable foreign exchange were the key drivers, while year on year margins were marginally softer.
These margins reflect the full absorption of annual merit increases offset by productivity gains and structural cost interventions. DET delivered an ebit margin of 12.4% in Q4, a resilient outcome given the revenue softness in the quarter, while gross margin expansion provided a positive tailwind in it was offset by conscious investments in leadership capability. We also had forex headwinds from non INR cost in certain geographies. Importantly, our cost rationalization program played a pivotal role in absorbing these investments and holding margins steady.
We have a very good framework in place to ensure the sustainability and continuity of these cost actions going forward. Q4 Det Pat stood at 138 crores reflecting a sequential 7.6% and a year on year 9.1% decline. This movement was largely attributable to the normalization of other income which had been elevated in prior periods due to higher unrealized forex gains and reinstatement related benefits. The effective tax rate for Q4 is a bit higher at 29.6% including a one time prior period drew up on normalized basis.
We expect the tax rate to be in the range of 27 to 27.5%. On the cash front, DET delivered another strong quarter of free cash flow which came in at 225 crores representing a healthy 163% conversion of PAT. This is a direct outcome of sustained focus on working capital efficiency and collections discipline. As Krishna highlighted earlier, a key adjustment this quarter is an exceptional charge of 71 crores of due diligence expenses tied to a large amended transaction which is currently on hold. To provide a cleaner view of underlying performance, EBIT PAT and EPS are presented on a normalized basis excluding this item.
Full reconciliation between reported and normalized figures are available in the annexure that is shared with you. Now moving on to the full year performance, FY26 DET revenue was $657.6 million reflecting a marginal constant currency decline of 0.7%. In INR terms, revenue stood at 5819 crores registering a 5.5% year on year growth on the back of favorable currency movements for normalized ebit margin for FY26 is 12.2% a 67 basis points year on year contraction driven by revenue mix annual merit increases with partial relief from the currency.
Notwithstanding a challenging growth backdrop, margin discipline was well maintained through the year. Normalized PAT for FY26 is 588 crores up 7.2% year on year underpinned by higher other income and reduced finance costs. This year also saw the highest ever treasury income with reinstatement gains of 95 crores providing a meaningful offset to the head related impacts. Two exceptional items were normalized during the year. The 71 crore of amended diligence expenses in Q4 which we called out earlier plus a 40 crore gratuity provision arising from the Labour Code in Q3.
At the group level Q4 revenue stood at 209.9 million dollars reflecting a 0.9% sequential growth and a 7.2% year on year decline. INR revenue is rupees 1,927 crore with a sequential uptick attributable to the DLM segment for the full year. Group revenue is 820.8 million down 4.3% in constant currency and 7,268 crores in INR terms a 1.3% year on year decline. Group EBIT margin contracted 254 basis points year on year to 9.5% primarily reflecting strategic investments in the semiconductor business against the backdrop of revenue softness.
These investments are intentional and form part of our long term positioning with nonlinear growth expected in due course. Group PAT is 534 crores with EPS of 48.42 rupees representing a 14.3% year on year decline beyond the det normalization items. The group Results incorporate a $3 million impairment in our tooling division, a business outlook driven true up reported on the other segment. I’ll conclude by saying that we are confident of the outlook and the buyback will further improve the financial metrics and adds to the EPS growth next year.
I will now hand the call back to the moderator for any questions and answers.
Questions and Answers:
Operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press STAR and one on their touchtone telephone. If you wish to withdraw yourself from the question queue, you may press star and 2. Participants are requested to please use handsets while asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. Our first question comes from the line of Bhavik Mehta from JP Morgan. Please go ahead. Bhavik Mehta your line is unmuted.
You may proceed with your question.
Bhavik Mehta
Hello.
Operator
You are audible, sir. You may go ahead.
Bhavik Mehta
Thank you. So, three questions. Firstly, can you quantify the exposure to West Asia as a region in terms of the venues for the det business to get a sense of what could be the potential headwinds we could anticipate over the next couple of quarters.
Sukumal Banerjee
Yes, sure. So firstly, our direct exposure to West Asia business is not significant. However, we do work with some tier one EPC and companies which service the energy market. And that is more of a project based exposure. So it’s difficult to assess in terms of exact number. But you can consider that it’s not a significant portion of our business overall at science as well as at an energy level. However, given that investment we have been doing in Middle east for almost a year now, we had built up a pipeline which was on the verge of closure and which is what I refer to in my commentary.
Bhavik Mehta
Okay, got it. The second question is around the project Astro, what you mentioned, any color you can provide in terms of what kind of asset you are looking at and which vertical was this in? Whatever you can share.
Krishna Bodhanapu
Unfortunately, I’ll just say it’s a very big transformative acquisition. It wouldn’t be fair with all the NDAs in place to talk about any specifics because that will give away too much detail.
Bhavik Mehta
Okay, the last question is on the business. You know, if you do decide to go for an equity raise, what kind of dilution are you happy to go with? I mean because in the DLM business we have seen the shareholding go to as low as 51% over year. Any you’ll be looking at.
Krishna Bodhanapu
So the first, the first race will be a small race just to cover for, you know that business still need some capital, need some cash, working capital, etc. Which I think is not fair. Now to fund from scient given that the business has its own strategy and its own objectives. So I’ll just say that it will be a relatively small fundraise. We won’t dilute more than maybe 10 12% of the equity to start with. And then depending on how the business evolves, the capital needs will relook at it. But the first equity raise won’t be more than 10 12%.
Bhavik Mehta
Okay, thank you.
Operator
Thank you ladies and gentlemen. To ask a question may press star and 1. Our next question comes from the line of Manish Agarwal from Tradeswift Group. Please go ahead.
Bhavik Mehta
Hello sir. Thank you for giving this opportunity. I have couple of questions. The first question is that despite consistent commentary on the strong pipeline
Operator
And account mining, the revenue growth has been modest. So can you quantify pipeline to revenue conversion timeline and what specifically is delaying that conversion?
Sukumal Banerjee
Okay, so if I understand your question right, in terms of, if you’re referring to this specific quarter, it was not a pipeline conversion issue. It was an issue of three key customers delaying their start of program. And these are regular business that we do year over year, which got delayed in terms of their budget allocations to these programs. In terms of the question about pipeline to revenue conversion, typically our converted order intake or order book gets consumed to the extent of 75% within the first nine months.
So that’s the average at a company level. So it’s not about delays in pipeline. The delay that I called out were some specific deals which were accounted for in our forecast for this year, this quarter, I mean, which is Q4 and they got pushed out and will not convert in Q1 as well.
Operator
Okay, so by when can we expect the conversion?
Sukumal Banerjee
So just to clarify, these were very specific deals which are two, three small deals which accounted for a number which impacts at a quarterly level. It is not something which impacts at a yearly level.
Operator
Okay, just one more question, like, given that you are returning cash via buyback while also exploring a fundraise, how do you reconcile these two actions from a capital efficiency standpoint?
Krishna Bodhanapu
Absolutely. So the fundraise, the buyback is for Science, the fundraisers for Signed Semiconductor. I think it’s a good opportunity for us to establish the value of Science Semiconductor because we believe that there’s a significant value unlock that is available. So these are two disconnected actions in the sense that the buyback is really because in science, looking at our capital requirements, looking at obviously where the share price is and has been, the board felt that it was a good time to do a buyback now for Sign Semiconductor.
I think we want to establish an independent value because we believe there is a huge value unlock in Sign Semiconductor. That’s why we’re going to raise again, it doesn’t need a huge amount of money, but we’re going to raise the money that it needs for it, for the money that Science Semiconductor needs for us to get to a break even point which will happen sometime towards the end of this year, early next year. So we want to make sure that the Science shareholders are not getting penalized for the performance of Science Semiconductor by establishing an independent valuation and an independent capital structure.
So in that sense, yes, absolutely. We could have funded it from Science. That’s not a problem at all. But I Think that could have not gone down well also because there are a lot of questions that come up on the losses in science semiconductor, etc. Margins of science Semiconductor. My hypothesis and my strong belief, which you will see when we do the capital raise, that it is a very valuable asset and we just need to establish the value of that asset.
Operator
Oh, thank
Bhavik Mehta
You so much.
Operator
I’ll join the team. Thank you. Our next question comes from the line of Moesh Chandani from Ambit. Please go ahead.
Bhavik Mehta
Yeah. Hi, good evening and thank you for taking my questions. Firstly, on the strategic unit business, this is a very sharp degrowth. Now looking at Q1, is the expectation that growth will you see continued degrowth because of some of these projects getting pushed back or do you think that there’ll be maybe a mild recovery going into Q1 and then some improvement in Q2? And secondly, in terms of these pushbacks, in terms of the customers delaying the start of the program, do you see that at least coming back in Q2 or Q3 or do you think that some of these programs have been permanently cancelled because of budget issues?
Sukumal Banerjee
So there are two aspects. Let me address the second question. First, the delays which have happened in connectivity, they are already in execution already. So it’s not that they are pushed out. There was a delayed start and these programs have a capacity in terms of execution. So it doesn’t mean that because we could not execute in Q1, all of that, sorry, Q4, all of that will get executed in Q1. It basically gets pushed back because at the customer end there is a certain capacity at which they can absorb the work that we execute as we do the designs.
They have to translate that into construction and they only have a limited capacity into construction. So that’s from a connectivity perspective when it comes to energy. And your point on West Asia, it’s difficult to say when it is going to come back. You know, the situation is very dynamic. But overall, from a strategic units perspective, we have as a mix of portfolio, we definitely would want to bring it back to as close as flat for next quarter.
Bhavik Mehta
Okay, understood. So flat growth is what Flat numbers are what you’re thinking of in the next quarter for the strategic units?
Sukumal Banerjee
That is what we are working towards. That’s correct,
Bhavik Mehta
Sure. And now with the semiconductors business, now that you’ve completed the acquisition of kinetic, any sense in terms of where you see numbers for FY27 and then also just a little bit in terms of what the strategy is with your existing projects and kinetic, how you see growth as well as Margins evolving for the semiconductor.
Krishna Bodhanapu
So I’ll very quickly say that we will have a very good year in the semiconductor business. I think both the core business is doing well. We’ve won a number of programs. The one that of course we talked about is a semiconductor complex modernization program and there’s many others. And of course Kinetic will add a significant number to that, I think. We haven’t publicly disclosed what the Kinetic number will be, so it might not be prudent here, but we will get to a hundred million dollar run rate at least, or $100 million kind of a number for this, for this year.
Margins for the year will still be negative just because we are building the product portfolio and we’re building the product portfolio and the intellectual property that is going to consume a bit of money. And again, I want to be very clear that one of the reasons why I do want to establish the value of that business is within science. We’re being unfair to shareholders if we don’t establish the value and yet invest at the rate at which we’re investing. And I’m very confident that this is at least a DLM like investment, if not even better.
So anyway, on the longer term basis, our objective is to focus on two things. One is what’s called custom asic, that is to design and build, design, manufacture and supply chips for specialized custom applications. This is somebody has a particular need, we design the chip, provide it to them. And the second is of course to have a product portfolio of ASPs or standardized chips. They’re still customizable chips, but mostly standard. And that portfolio comes through Kinetic. Now our focus will be primarily on a few areas, but it will be primarily on power.
As you know, power management is a huge thing with where things are going both with the commercial applications like data centers and consumer applications, phones, laptops, what have you. So our focus will be on power and our stated objective is to become a leading power silicon manufacturer. I’m also very happy to state that with Kinetic last year we would have shipped 250 plus million silicon chips. About 200 plus from Kinetic, about 20 or so from Scient itself. So we’re in a great starting point and again, I’m very, very excited where that business is going to go.
Bhavik Mehta
All right, understood. And then just the last question from my side. In terms of your outlooks for FY27, we previously said that we wanted to reach say a 15% EBIT margin by 4Q of FY27. And then is that outlook still there? And also any qualitative expectations that you can give in terms of how growth will look like in FY27 would also be
Sukumal Banerjee
Sure. So on FY27, as I mentioned before, we’ll continue that commentary which is we are aspiring for mid to high single digit organic growth year over year. There are of course dynamics at play in the market, but we feel confident that 2, 3 of our markets will produce enough strength to get us there. The range is between the mid single digits to high single digits. From a margin perspective, yes, we maintain the same. It does depend a little in terms of volatility that we experience because of the current geopolitics.
Because as you can understand, in a project based business like energy, which is a substantial portion of our business, if we see lot of dynamics in terms of volatility, it might affect our cost versus our revenue situation on a quarterly basis. So other than that, we do want to commit to the fact that we are still working towards those numbers and achieving those numbers.
Bhavik Mehta
Got it. Thank you.
Operator
Thank you. Participants who wish to ask questions may please press star and one. Our next question comes from the line of Madhur Rathi from CCIP. Please go ahead.
Madhur Rathi
So firstly I want to thank the promoters for announcing the buyback and not participating. So which is a huge vote of confidence in the business and future prospects of the company. So now sir, being a layman investor who’s basically tech illiterate, if you could just explain to us that what exactly has been the pain point that our EBITDA, our EBITDA margins are down from 18% in FY24 to like 13% this year. And despite such huge rupee depreciation during this period, one would have expected it to alleviate the other, I mean the recessionary demand and so on.
So in your best judgment, when do you foresee us recouping the 1300 crore EBITDA that we did in FY24 or reaching around 18% EBITDA margins.
Krishna Bodhanapu
So let us. So okay, you’re saying that when will we get back to, okay, the EBITDA numbers you’re talking about or the EBIT numbers? Because EBIT was never, at least not in their last five years EBIT. I think the highest EBIT that we’ve done was 16% in Q4 of FY24. Is it EBITDA or EBITDA different?
Madhur Rathi
No. So the 18% is the EBITDA margin in FY24 and it was 1300 crore absolute EBITDA.
Krishna Bodhanapu
Absolutely, yeah. So question is, when will we come back to, you know, let’s say a 15% EBITDA margin?
Srinivas Kulkarni
No, I think if we are aspiring towards a 15% EBIT now by Q4 of FY, that will translate almost 17, 17 and a half percent EBITDA anyway. Right. So we are quite close to that number. So that’s the goal we are working towards. So I think the previously stated comment is we will try and get there by Q4 of FY27.
Madhur Rathi
Understood. And sir, now this, you were alluding to the monetization of stake in Fiant Semiconductors. So firstly any ballpark dilution percentage that we are looking to dilute and also what kind of valuation are we looking at? Or in other words like if Science market cap is around a billion dollars, then how much of our market cap are we attributing to Science Semiconductors?
Krishna Bodhanapu
So from a dilution perspective we will keep it in the 10% range to start with because that’s all the capital we need to get to the next phase of breakeven and further growth. Now in terms of what percentage of science market cap now that’s for our investors to determine which as I understand it, the value that’s attributed to Science Semiconductor is marginal if not negative because if we just do a simple EBIT multiple EV2 EBIT multiple then it actually becomes negative because it’s a money losing business.
So right now our understanding or expectation is best case that it’s a marginal value or a zero value but in reality the value is much higher and that’s why we want to create a monetization for it so we can establish the value and really then have a basis why we want to continue to invest to grow a much, much larger business.
Madhur Rathi
Now sir, finally sir, part of our business do you believe is most at threat from AI?
Krishna Bodhanapu
Which part of our business?
Sukumal Banerjee
So it’s
Madhur Rathi
Most under threat from AI?
Sukumal Banerjee
Yeah. So there are, there are, there are two, three scenarios we have to understand about, about what’s going to play out and it might sound like a complicated answer but because it is, it is complicated. Firstly, there is a significant opportunity in front of us on AI which is why we invested in the AgentIQ platform engineering intelligence platform which is a growth driver for us in the future as we have pivoted more and more from being an ER&D company to a full lifecycle company for products.
It’s a significant opportunity in front of us. Just to give you a perspective on outsourced spend. It changes from about $100 billion which is the ERND outsourcing spend to almost $3 trillion which gets spent Today on life cycle management, we already participate in that in a growing and significant way in the aerospace market. And that is why you see our robust growth in the transportation and mobility segment. So that’s a positive. Second is there are two hypothesis over here at play and this is with regards to our data business.
One is because of AI, there’ll be a significant investment by several business operations and companies in the industrial space to actually structure their operations. Data manufacturing data supply chain data, which has typically never been focused on because there was no value creator or value driver, which now exists in the form of AI. And because of that, there’ll be a huge amount of investment which will happen and we are already seeing some of that starting in terms of the data quality, data management, data operations work.
So there will be a plus and a minus which will play out at what pace, which one will grow is difficult to say, but we believe it will be slightly positive. Third, there is obviously compression on some of the work that we do, which is not a very significant portion of our business, which is software development. It is an established fact that we are already seeing 20 to 30% productivity improvement. So whatever used to take 100 units of work now can be done with 70 or even 60. So given that it’s a small portion of our service portfolio, as we are growing our technology business from single digits overall signed revenue, all of this is a possible upside for us.
So from a signed perspective, we feel very confident. Given our portfolio, AI threat is minimal. Having said that, AI is an evolving topic. As more things come into play, we will obviously be very vigilant about how does this apply to our business. And in many cases, we have invested heavily to be ready for what AI brings across our service lines, whether it is mechanical engineering or plant engineering. In fact, the appointment of Prabhakaratla as the coo, one of the key aspects is how do we transform our service lines ahead of time.
So as I said, it’s a complicated answer. So which, which is what I shared with you.
Operator
Thanks
Madhur Rathi
A lot.
Operator
Thank you. Our next question comes from the line of Rajast Joshi from Chris Capital. Please go ahead.
Bhavik Mehta
Yeah, thank you for the opportunity. Hope I’m audible. My first question would be on the. On the nature of a deal win, could you please give some quantitative color, especially some numbers on the nature of our deliverance this quarter.
Sukumal Banerjee
Yeah, so I think I Talked about the H2 over H2 comparison of 5.5% growth in FY26 over FY25. We also a significant portion of that growth came in Q4 where we had a 23% growth in order intake over previous year. So that is where I leave it in terms of numbers and comparisons in terms of nature of deals, as I cited, quite a few of them were longer term as in 2, 3 years consolidation deals across various segments like aerospace, rail, connectivity. That is where we have seen significant growth. A large portion of our order intake was also project based wins that we have in energy that we typically have in energy.
So that also came in as far as Q4 order intake was concerned.
Bhavik Mehta
Okay, okay, understood. And secondly, on margins, right? So the walk to 15% kind of exit margin, if you could just expand on some of the levers that are at play which will support this margin expansion.
Srinivas Kulkarni
Yes, we have a bunch of levers, right. Both on the revenue side as well as on the cost side. On the revenue side I think we are talking about price hikes. We are talking of on the cost side delivering the same revenue using automation, AI, et cetera, which will bring in further savings in our costs. We have a program we are running on to cut costs in some of the administrative expenses. So these are all the levers. So other than the usual tailwinds from forex, etc. Which we will expect because of where the currency is today, I think there are fundamentally, there are a lot of operating levers that we are working on which will yield us the desired results.
Bhavik Mehta
And if I
Sukumal Banerjee
May add, since there was a question on AI a little while back, AI is also an opportunity in terms of being cost efficient within the company and we are doing that in a pretty structured serious way this year.
Bhavik Mehta
And lastly on the pipeline, so again if you could just help us with some color on the pipeline from a segmental basis.
Sukumal Banerjee
Okay, so what I’ll share is that our number of large deals have gone up in terms of pipeline and we continue to develop those deals. And pretty much, I would say in six or out of our, or five out of our seven market segments, we have large deals now in our pipeline. It is led largely by connectivity and healthcare at this point in time. But I’m sure we’ll start seeing it coming across multiple markets of ours. So that is where we are on pipeline overall as a percentage of new pipeline. That percentage keeps growing up every quarter and it went up in Q4 as well.
Bhavik Mehta
Thank you for this detailed answer and wishing you all the very best. Thank you.
Sukumal Banerjee
Thank you.
Operator
Thank you ladies and gentlemen. We will take that as a last question. I would now like to hand the conference over to Mr. Krishna Bodhan Appu for closing comments. Over to you sir.
Krishna Bodhanapu
Thank you very much. Thank you everybody for participating in this call. Obviously a lot of exciting things are going on with of course with the core business in det. Of course Q4 was a little bit of a slower quarter and a little bit of lower than what we had anticipated due to the reasons that Sukhmal talked about. But I want to say we’re very excited about what holds for us in FY27, including the growth aspiration or the growth objectives that Sukhumal talked about in terms of mid to high single digits and also the margin aspirations that Srini and Sukumal talked about.
So the core business with its pipeline and order intake looks very good. And of course a lot of exciting things are happening within the Science group, which includes what’s going to happen with Semiconductor and also the confidence that, that the board demonstrated in the management to continue to generate a very strong cash flow in announcing a very, very significant buyback. It will be among the largest buybacks in the tech sector. And that’s because our board is very confident that while we have a lot of investment opportunities, we also have a lot of avenues for cash generation.
So thank you very much for your support and we’ll again speak next quarter. Thank you.
Operator
Thank you. On behalf of Science limited That concludes this conference. Thank you all for joining us. You may now disconnect your lines.