Despite a 40% rise in revenue, Kaynes Technology India’s June quarter results reveal profit declines, rising debt and cash flow concerns, prompting mixed analyst reactions and delayed growth forecasts.
Kaynes Technology India Ltd.’s June quarter drew a mixed response from analysts after a sharp rise in revenue was overshadowed by weaker profit, a heavier working-capital load and higher net debt. Kotak retained its “Reduce” recommendation, JPMorgan stayed at “Neutral” and Nuvama cut its view to “Reduce”, arguing that the shares had already run up too far despite the quarter’s operational strengths.
According to the company’s results, consolidated revenue jumped 40.5% year on year to Rs 946 crore, while EBITDA rose 29.5% to Rs 147 crore. Even so, net profit fell 24.4% to Rs 56.4 crore as gross margins narrowed, employee costs climbed and other income declined. The company also posted a negative operating cash flow of Rs 260 crore, which added to investor concerns.
Brokerages said the most troubling part of the quarter was the strain on cash conversion. Kotak pointed to working-capital days rising to 163 from 122 in the previous quarter, while net debt increased to Rs 800 crore from Rs 200 crore. Smart-metering receivables were also highlighted as an issue, with collections still not moving as quickly as analysts would like.
JPMorgan said the quarter still marked a solid beat on both revenue and margin, but noted that working capital remained the key pressure point. Nuvama cut its FY27 and FY28 earnings estimates by 12% and 2% respectively, saying the revision reflected the profit miss and a softer outlook. It also cited the stock’s recent rally in lowering its rating.
The longer-term growth story remains intact, but the timing has shifted. Management now expects the OSAT and PCB facilities to begin operations in the third quarter of FY27, later than the earlier Q2 FY27 plan. That delay pushed back expectations for the next wave of growth just as the company warned that supply and cost conditions in the components market had worsened and could resemble the pressure seen during the Covid period.
That caution stands in contrast with the upbeat tone in earlier quarters, when Kaynes reported much faster profit growth and a widening order book. LiveMint said the company’s order book rose 22% sequentially in the June quarter, while Business Standard reported that the backlog had reached Rs 7,401.1 crore as of June 30, 2025. For now, though, analysts appear more focused on execution, cash generation and whether the company can convert its strong demand pipeline into cleaner earnings.
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