Shares of Kaynes Technology crashed as much as 19.4% to Rs 3,366 apiece on the BSE on Thursday after the electronics manufacturing company's Q4 results delivered a triple blow of revenue guidance miss, deteriorating balance sheet metrics, and a sharp decline in profit, prompting at least two brokerages to cut their ratings on the stock.JPMorgan downgraded the stock to Neutral from Overweight and slashed its target price to Rs 4,000, while Nuvama downgraded to Hold and cut its target price to Rs 3,550 from Rs 5,500, a reduction of nearly 36%.
Morgan Stanley maintained its Equal-weight rating with a target of Rs 3,663.
CLSA retained Outperform with a Rs 4,200 target but acknowledged the results were a clear negative.Kaynes posted Q4 revenue of Rs 1,243 crore, a 26% year-on-year increase but the company had guided for Rs 1,700 crore, making the miss a staggering 27% below its own target.
JPMorgan noted the results missed even the lowered Street and JPMorgan estimates by 18% and 13%, respectively.
While we still expect strong 40%/45% revenue/earnings CAGR over FY26-28E thanks to the ramp-up of OSAT and PCB businesses, we believe the stock will remain a 'show me' stock until the gap between actual numbers and company guidance narrows, JPMorgan wrote in its note.The company’s working capital trajectory also came as a concern for analysts.
