plunged over 19 per cent on Thursday after the company reported a weaker-than-expected March quarter performance and brokerage firm JP Morgan downgraded the stock citing concerns over slowing growth and execution visibility.
Shares traded at ₹3,438.30 on the NSE at 9.57 am after hitting a low of ₹3,366.10 from the previous close of ₹4,178.40.
The sharp decline in the stock came after the company’s quarterly results missed Street expectations across key parameters, while brokerages also flagged deterioration in the balance sheet and softer revenue outlook.
Kaynes Technology reported a 17 per cent y-o-y rise in standalone net profit at ₹70.94 crore for the March quarter, compared to ₹60.4 crore in the same period last year. However, revenue from operations declined 6.5 per cent y-o-y to ₹688.1 crore from ₹736.5 crore a year earlier. Revenue also moderated on a q-o-q basis amid softer business momentum.
For the full financial year FY26, the company’s profit after tax stood at ₹254.1 crore, compared to ₹209.9 crore in the previous year.
JPMorgan downgraded the stock to “neutral” from “overweight” and slashed its price target to ₹4,000 from ₹6,000 earlier. The brokerage cut its earnings estimates for Kaynes Technology by 12 per cent to 17 per cent over the next two years, citing lower expectations from both the core EMS and OSAT businesses.
The brokerage also reduced the valuation multiple for the company’s core EMS business to 33 times from 45 times earlier, due to expectations of slower revenue growth over the next two years and in the medium-to-long term, along with rising net working capital days.
While still expecting a strong 40 per cent revenue CAGR and 45 per cent earnings CAGR over financial year 2026-2028, thanks to the ramp-up of the OSAT and PCB business, we believe the stock will remain a ‘show me’ stock, until the gap between actual numbers and the company guidance narrows, JPMorgan said in its note.
Brokerage firm CLSA also expects a negative reaction to the stock following the results and highlighted further deterioration in the balance sheet as a key concern. However, the brokerage maintained its “outperform” rating on the stock with a price target of ₹4,200.