Hold Kaynes Technology India; target of Rs 6367: Prabhudas Lilladher

Prabhudas Lilladher recommended hold rating on Kaynes Technology India with a target price of Rs 6367 in its research report dated July 31, 2025.

Broker Research

August 04, 2025 / 11:08 IST

hold

26 Aug, 2025 12:21

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Prabhudas Lilladher's research report on Kaynes Technology India

KAYNES has maintained its guidance to reach Rs 45bn, however revised its margin guidance from 15.6% to ~17% by FY26. In Q1FY26 company is having an order book of Rs 74bn mainly driven from aerospace, industrial and automotive. The OSAT facility development is on track, with estimated revenue starting in Q4FY26, while PCB manufacturing is expected to begin as planned, contributing to revenue from FY27 onwards. Company acquired August Electronics to strengthen its North American footprint and to get access to high-value global customers in sectors like energy, petroleum, medical, telecom, and IT. KAYNES reported 33.6% YoY revenue growth in Q1FY26, driven by a 43.3% YoY increase in the industry segment (which contributed 59% rev.). The EBITDA margin stood at 16.8%, (Expanded by ~250bps). We estimate FY25-27E revenue/EBITDA/PAT CAGR of 52.2%/56.7%/54.9%, with EBITDA margin expansion of ~90bps. Maintain to ‘Hold’.

Outlook

We revised upward our FY26/FY27 EPS estimates by 6.1%/5.1%, mainly with expansion in EBITDA margin and lower interest expenses following debt repayment from QIP proceeds, although equity dilution has partly offset the impact on earnings. We are maintaining our ‘HOLD rating’ due to the significant uptick in the stock price. Our revised DCF-based TP is Rs 6,367 (up from Rs 6,068), implying PE of 60x FY27E earnings.

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