Explained: Why analysts raised Kaynes Tech stock target post Q1 results?

Kaynes Tech shares rose as much as 5 per cent in the intraday trade on Friday, hitting a high of ₹6,483 per share

Kaynes Technology shares were in demand on the BSE on Friday as the company’s solid quarterly earnings for the June quarter attracted investors towards the EMS player.

 

Analysts, on their part, too, raised their share price target on the stock, seeing an upside of up to 40 per cent over the next one year.

Kaynes Tech share price today

Kaynes Tech shares rose as much as 5 per cent on the stock exchange in the intraday trade on Friday, hitting a high of ₹6,483 per share. On the National Stock Exchange (NSE), the stock hit a high of ₹6,488 per share.

 

The stock was, however, off highs at 12:27 PM, trading 4.16 per cent higher at ₹6,432 per share on the BSE as against a 280-point (0.34 per cent) decline in the benchmark BSE Sensex.

 

About 0.14 million shares had changed hands till the time of writing this report, higher than the two-week average volume of 0.03 million shares seen on the BSE. Combined with the volume on the NSE, a total of 1.67 million shares changed hands, thus far, in trade.

 

Notably, Kaynes Tech shares hit a 52-week high of ₹7,824.95 per share on the BSE on January 1, 2025, and a 52-week low of ₹3,835 per share on February 11, 2025.

 

The stock’s price-to-earnings (P/E) ratio, as per the BSE website, is 199.46 times, and has stayed above 50x for four consecutive quarters. Kaynes Tech stock’s P/B ratio, meanwhile, stands at 16.9x.

 

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Kaynes Tech Q1 results highlights

The BSE500 company reported a lower-than-expected surge in consolidated revenue at ₹670 crore, up 34 per cent year-on-year (Y-o-Y). This was, however, offset by a 69 per cent Y-o-Y increase in Ebitda to ₹110 crore.

 

Kaynes Tech’s Ebitda margins expanded 350 basis points Y-o-Y to 16.8 per cent in Q1FY26, beating estimates, led by a steep expansion in gross margin (up 14 percentage points Y-o-Y) due to a favorable business mix and reduction in raw material cost.

 

Adjusted net profit climbed 47 per cent Y-o-Y to ₹74.6 crore.

 

That apart, Kaynes Technology’s order inflows remained strong in Q1FY26, coming at ₹1,480 crore, boosting the order book by 47 per cent Y-o-Y and 12 per cent Q-o-Q to ₹7,400 crore. The order book was anchored by high-margin sectors like Aerospace, Industrials, and Automotive.

 

The management said it is targeting North America for further inorganic growth and that it would like to focus on Europe for design and ODM (in railway, industrial, etc.) related business.

 

The company also aims to deepen its technology footprint by suitably adding backward integration into niche areas. 

Kaynes Tech FY26 guidance

The Management has retained its full-year revenue guidance of ₹450 crore. Ebitda margin, it said, is expected to be in a similar range to Q1 (it is revised upwards).

 

Kaynes Technology outlook: What brokerages say

Nomura | Buy | Target price: ₹7,878

 

Nomura said Kaynes; smart meter execution was fast paced with 20 to 25 per cent installations done over Apr-July, 2025. It expects EVs adoption in two-wheelers to touch 19 per cent by FY30, from 6 per cent in FY25.

 

Ramped-up railways and aerospace are other catalysts for Kaynes. The management plans acquisition targets in North America which, Nomura said, would expand its addressable market. OSAT/PCB execution remains on track, with ramp-up to play over FY27/28, it noted.

 

“Our revenue and Ebitda estimates remain largely unchanged with margin at 15.6 per cent and 15.8 per cent, respectively, over FY26-27F, at the lower end of management target. Our revised higher other income leads to a 7-8 per cent EPS increase,” it said.

 

Motilal Oswal Financial Services | Buy | Target: ₹7,300

 

MOFSL said the company appears well-positioned to sustain growth and profitability going ahead on the back of improving operating leverage, a favorable order mix, and continued investments in high-tech verticals.

 

“We estimate a revenue, Ebitda, and adjusted net profit CAGR of 58 per cent, 65 per cent, and 74 per cent over FY25-FY27,” it said.

 

Elara Capital | Accumulate | Target: ₹7,100

 

Elara Capital has raised its FY26 EPS estimates by 8 per cent on better-than-expected margin for the year and higher other income. It, however, has maintained its FY27 and FY28 EPS estimates.

 

The brokerage has raised the stock’s target price to ₹7,100 from ₹6,380, valuing the stock at 60x June FY27 P/E, led by strong momentum in India’s EMS landscape (on import substitution, and Kaynes enjoying industry-leading margin and robust order inflows).

 

"We reiterate Accumulate as the stock has outperformed the Nifty by 23 per cent in the past six months. We expect an earnings CAGR of 50 per cent during FY25-28 with average RE and RoCE of 12 per cent each, during FY26-28," it said.  ALSO READ | TVS Motor, Eicher gain up to 4% in weak market. What's driving 2W stocks? 

Nuvama Institutional Equities | Hold | Target: ₹7,100

 

The brokerage likes Kaynes Technology due to its well-diversified client base across key verticals; and marquee client roster. Meanwhile, robust B2B capex trends and the government’s import substitution push are conducive for the sector.

 

“We believe Kaynes is well poised to deliver a strong 48 per cent, 53 per cent, and 46 per cent CAGR in revenue, Ebitda, and net profit, respectively, in FY25-28 on the back of robust order book as well as new order wins and ramp up in new verticals (OSAT and HDI PCB), given it is one of the few full stack electronics player in India,” it said.

Risks to earnings growth

According to analysts, the domestic EMS sector has been on the front-foot due to favourable government policies. Any change in government stance on manufacturing-related policies, particularly adverse changes, shall be the biggest risk to the EMS sector growth.

 

About Kaynes Technology

 

Kaynes Technology was founded in 1998 and has over three decades of experience in providing conceptual design, process engineering, integrated manufacturing, and life-cycle support to OEMs.

 

Kaynes’ clients belong to sectors such as industrial electronics, railway electronics, medical electronics, defence electronics, automotive electronics, and IT hardware. It has evolved as an integrated electronics player by moving into OSAT and HDI PCB.