Cyient has announced the acquisition of Singapore-based Global Services Engineering Asia (GESA) from Pratt & Whitney (P&W). GESA strengthens Cyient's aftermarket capabilities in the aerospace segment. GESA has been catering to P&W’s MRO (maintenance, repair and overhaul) requirements in the region.

GESA currently has a revenue base of USD10-12 million with EBITDA margin in the 12-14% range. Cyient has been in the design engineering services segment and had recently acquired Rangsons to augment its design-led manufacturing capability.

Commenting on the development, Edelweiss Securities said, ''The current acquisition extends its capabilities in the aftermarket and MRO space. While the acquisition does not provide meaningful upside to our estimates, we believe it to be strategic and benefits will accrue in the long term.

While the acquisition does not lend material upside to our estimates, we believe it is a step in the right direction and in line with Cyien's long-term strategy of achieving higher proportion of revenues from systems and solutions. The stock is trading at 12.4x FY17E EPS. We maintain 'Buy' with target price of Rs 600.''

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