Kaynes Technology India (KAYNES IN) – Q4FY26 Result Update – Metering Challenges Offset EMS Growth – Downgrade to ‘Accumulate’
Published on 14 May 2026
The company missed its revenue and profitability guidance in FY26 mainly due to delays in execution of two government-related smart meter projects in Q4FY26, geopolitical disruptions, supply-chain challenges and weakness in a key EV customer. The automotive/Industrial segment grew by ~19%31% in Q4FY26. By the end of FY26 company is having an order book of Rs 84bn, reduced from Rs 91bn by the end of 9MFY26. Additionally, average monthly order inflow witnessed a significant decline, while working capital days increased by ~23 days YoY in FY26, mainly due to a 57-day rise in receivable days. Company refrained from providing absolute FY27 revenue guidance; however, it expects KAYNES to grow at nearly 2x the EMS industry growth rate of ~15–16%. Management indicated that working capital stress has likely peaked and expects ~70–80% normalization over the next three quarters and OCF to be positive in FY27. We have downward revised our FY27E/FY28E earnings by 29.3%/27.9% with correction in guidance and downgrade to ‘Accumulate’ rating. Our DCF-based TP is Rs 3,506, implying PE of 40x Mar’28E earnings We estimate FY26-28E revenue/EBITDA/PAT CAGR of 39.0%/37.6%/26.3%.
