Why Kaynes Technology shares crashed 19% | Downgrade by brokerage - Target price cut
Shares of Kaynes Technology India cracked nearly 20 per cent on Thursday, merely shy of its third circuit filter following a dismal performance in the March 2026 quarter.
- May 14, 2026,
- Updated May 14, 2026 11:55 AM IST
Shares of Kaynes Technology India Ltd cracked nearly 20 per cent on Thursday, merely shy of its third circuit filter following a dismal performance in the March 2026 quarter. The stock dropped 19.4e per cent in the early session to Rs 3,366, against its previous close at Rs 4,177.85.
Shares of Kaynes Technology have tanked more than 56 per cent from a 52-week high at Rs 7,705 hit in October 2025. Its market capitalization dropped to Rs 22,563.86 crore, from its previous close at Rs 28,006.07 crore, with investors losing nearly 5,445 crore on an intra-day basis.
Kaynes Technologies India reported a 21.5 per cent YoY fall in the net profit at Rs 91.2 crore, while its revenue increased 26.2 per cent YoY to Rs 1,242.6 crore for the quarter ended on March 31, 2026. Its ebitda rose 15.4 per cent YoY to Rs 193.6 crore, while ebitda margins contracted 140 basis points to 15.6 per cent for the reported quarter.
Its order book exceeded Rs 8,000 crore as of March 31, 2026. However, the company missed its own downgraded FY26 revenue guidance of Rs 4,100 crore, reporting lower growth than anticipated. Finance costs doubled to Rs 41 crore, and depreciation increased by 178 per cent for the reported period.
Kaynes posted a largely weaker than expected Q4 with revenue and Ebitda growth of 26 per cent and 15 per cent YoY, missing estimates, said Nuvama Institutional Equities. Adjusted PAT declined 21 per cent YoY. OCF at (negative) Rs 600 crore versus guidance of marginally negative to positive, as working capital days rose from 87 to 125, it said.
"We cut FY27E/28E EPS by 22 per cent/20 per cent to reflect weak Q4 and challenging near term. We value Kaynes at 35 times FY29 EPS with discount at 18 per cent, yielding a March 2027 target price of Rs 3,550 (Rs 5,500 earlier). We downgrade to 'hold' rating," it added as it trimmed the target price by 35 per cent.
Similarly, overseas brokerage firm JP Morgan has also downgraded the stock to 'neutral' from 'overweight' and slashed its target price by more than 33 per cent to Rs 4,000 from Rs 6,000 earlier. JPMorgan has cut Kaynes Tech's earnings estimates by 12 per cent to 17 per cent over the next two years, led by cuts across the core EMS business, and the OSAT business as well.
Another global brokerage firm CLSA was expecting a negative reaction to the stock after its results and after a further deterioration in its balance sheet, which was a key monitorable. However, the investment banker has an 'outperform' rating with a price target of Rs 4,200.
"Our downgrade on Kaynes is premised on three core factors- miss on FY26 revenue guidance despite several downward revisions and our belief of a cut in FY28E target of Rs 8,500 crore revenue; working capital cycle of 179 days at end-March 2026, the smart meter business operating at 1 year cycle; and continued cash burn; negative OCF of Rs 600 in FY26," said JM Financial with a 'reduce' rating a target price of Rs 4,350.
Shares of Kaynes Technology India Ltd cracked nearly 20 per cent on Thursday, merely shy of its third circuit filter following a dismal performance in the March 2026 quarter. The stock dropped 19.4e per cent in the early session to Rs 3,366, against its previous close at Rs 4,177.85.
Shares of Kaynes Technology have tanked more than 56 per cent from a 52-week high at Rs 7,705 hit in October 2025. Its market capitalization dropped to Rs 22,563.86 crore, from its previous close at Rs 28,006.07 crore, with investors losing nearly 5,445 crore on an intra-day basis.
Kaynes Technologies India reported a 21.5 per cent YoY fall in the net profit at Rs 91.2 crore, while its revenue increased 26.2 per cent YoY to Rs 1,242.6 crore for the quarter ended on March 31, 2026. Its ebitda rose 15.4 per cent YoY to Rs 193.6 crore, while ebitda margins contracted 140 basis points to 15.6 per cent for the reported quarter.
Its order book exceeded Rs 8,000 crore as of March 31, 2026. However, the company missed its own downgraded FY26 revenue guidance of Rs 4,100 crore, reporting lower growth than anticipated. Finance costs doubled to Rs 41 crore, and depreciation increased by 178 per cent for the reported period.
Kaynes posted a largely weaker than expected Q4 with revenue and Ebitda growth of 26 per cent and 15 per cent YoY, missing estimates, said Nuvama Institutional Equities. Adjusted PAT declined 21 per cent YoY. OCF at (negative) Rs 600 crore versus guidance of marginally negative to positive, as working capital days rose from 87 to 125, it said.
"We cut FY27E/28E EPS by 22 per cent/20 per cent to reflect weak Q4 and challenging near term. We value Kaynes at 35 times FY29 EPS with discount at 18 per cent, yielding a March 2027 target price of Rs 3,550 (Rs 5,500 earlier). We downgrade to 'hold' rating," it added as it trimmed the target price by 35 per cent.
Similarly, overseas brokerage firm JP Morgan has also downgraded the stock to 'neutral' from 'overweight' and slashed its target price by more than 33 per cent to Rs 4,000 from Rs 6,000 earlier. JPMorgan has cut Kaynes Tech's earnings estimates by 12 per cent to 17 per cent over the next two years, led by cuts across the core EMS business, and the OSAT business as well.
Another global brokerage firm CLSA was expecting a negative reaction to the stock after its results and after a further deterioration in its balance sheet, which was a key monitorable. However, the investment banker has an 'outperform' rating with a price target of Rs 4,200.
"Our downgrade on Kaynes is premised on three core factors- miss on FY26 revenue guidance despite several downward revisions and our belief of a cut in FY28E target of Rs 8,500 crore revenue; working capital cycle of 179 days at end-March 2026, the smart meter business operating at 1 year cycle; and continued cash burn; negative OCF of Rs 600 in FY26," said JM Financial with a 'reduce' rating a target price of Rs 4,350.