Kaynes Tech cuts FY26 revenue guidance to ₹4,100 crore, maintains margin guidance

Shares of Kaynes Technology (India) Ltd. will be in focus on Friday, February 6, after it reported December quarter results after market hours on Thursday, which were significantly below analyst expectations across parameters.

The revenue figure of ₹804 crore was well below the management guidance of ₹1,300 crore, and even as margins expanded from last year, the expansion was not as much as the street was anticipating.

For the full year, the management has guided for revenue to be ₹4,400 crore. At the end of the first nine months, Kaynes Tech has only managed to reach 54% of that at ₹2,384 crore. Order book for the company though, went up by 12% sequentially to ₹9,072 crore.

Growth during the quarter was led by the Automotive business, which grew 44%, while industrial and railway businesses were down 4% and 18% respectively.

JPMorgan has maintained its "overweight" rating on Kaynes Tech with a price target of ₹6,100, stating that the two most important things to watch on the earnings call would be a potential cut to the revenue guidance for the year and an update on discounting of legacy receivables in order to bring down the net working capital days.

For the third quarter, Kaynes Tech's net working capital days increased to 139 days from 116 in the first half of the financial year.

Jefferies has also maintained its "buy" rating on Kaynes Tech with a price target of ₹5,940, but also highlighted the all-round miss, rise in net working capital and the net debt figures.

26 analysts have coverage on Kaynes Technology, of which 18 have a "buy" rating, eight say "hold", while four others have a "sell" rating. The consensus estimates of price targets implies a potential upside of 54% for the stock.

Shares of Kaynes Tech ended nearly 5% lower on Thursday ahead of the results announcement at ₹3,616, tracking the results reported by Qualcomm overnight.