Kaynes Tech Shares Plunge 8% Post One-Day Relief As Kotak Securities Cuts Target Price
Kotak Institutional Equities has maintained its "reduce" rating and cut its price target on Kaynes Tech to Rs 4,150 from Rs 6,180.
Shares of Kaynes Technology Ltd. plunged by 8% on Wednesday, Dec. 10, after a one-day relief rally as domestic brokerage Kotak Institutional Equities cut its price target on the stock on the recent sell-off. Today's rout in the session so far has erased much of Tuesday’s 14% surge that had briefly pause a four-day losing streak for the midcap stock.
The electronics manufacturers is under intense scrutiny from investors and analysts. Kotak Institutional Equities has maintained its "reduce" rating and cut its price target on the stock to Rs 4,150 from Rs 6,180. Earlier, the brokerage flagged off discrepancies in disclosures by Kaynes Tech, which had triggered a sell-off in the stock late last week, when it slid over 12%.
Kotak Institutional Equities on Kaynes Tech
According to Kotak's report on Wednesday, certain aspects with respect to intangible accounting and elevated working capital still remains unclear. It also said that the company's guidance for financial year 2026 is at risk. Last week, among its many allegations, the Kotak report had highlighted a sharp rise in contingent liabilities, estimated at 18% of net worth.
"The generation of positive operating cash flow in financial year 2026, improvement in internal controls, and timely execution of PCB and OSAT expansion will be crucial," said Kotak on Kaynes Tech in its note today.
Earlier, the brokerage pointed to the subsidiary’s 28% reported net margin in the second half of the year and an implied payback period of six months.
The management of Kaynes had clarified earlier in an analyst call that the company will turn cash flow positive by the end of the financial year and that the discrepancies in disclosures will not be repeated again.
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Kaynes Share Price Trend
On Wednesday, shares of Kaynes Tech opened 2% lower at Rs 4,417.50 on the NSE and plunged over 8% to hit an intraday low of Rs 3,980.00. The stock trades nearly 12% lower from its all-time high. The electronics company commands a market cap of Rs 26,666.39 crore.
According to stock exchange data, the stock has crashed 24.7% in just one week. On a year-to-date basis, the stock is down 46.23% and nearly 37.25% in the last 12 months. However, it has risen 449.41% in the last three years.
