Despite 47% YoY profit growth and a 30% revenue jump in Q3 FY25, Kaynes Technology’s share price plunged 19% after it cut its FY25 revenue guidance. What does this mean for investors? Let’s break it down.
Kaynes Technology’s Q3 FY25 results: Strong numbers but guidance cut hurts stock
Shares of Kaynes Technology India Ltd., a leading semiconductor and electronics manufacturing company, fell 19% on January 28, 2025, hitting a five-month low of ₹4,255.
The market reacted negatively after the company trimmed its FY25 revenue guidance from ₹3,000 crore to ₹2,800 crore, citing execution delays in the industrials segment. Despite this, Kaynes posted solid profit and revenue growth for the quarter.
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Key reasons for the share price drop
- Guidance cut for FY25: Revenue target lowered by ₹200 crore.
- Execution delays: Orders worth ₹100 crore couldn’t be completed in Q3 FY25.
- Stock valuation concerns: The stock had rallied 83% in the past year before the recent correction.
Let’s take a closer look at the financials.
Kaynes Technology Q3 FY25 financial performance
Despite the stock crash, Kaynes Technology delivered strong earnings growth in Q3 FY25.
Kaynes Technology Q3 FY25 financial highlights
| Financial Metric | Q3 FY25 | Q3 FY24 | YoY Growth |
| Revenue | ₹661.2 crore | ₹509.3 crore | +30% |
| Net Profit (PAT) | ₹66.5 crore | ₹45.2 crore | +47% |
| EBITDA | ₹94 crore | ₹69.9 crore | +35% |
| EBITDA Margin | 14.2% | 13.7% | +50 bps |
| PAT Margin | 10.1% | 8.9% | +120 bps |
The company maintained healthy margins, with a 14.2% EBITDA margin and a 10.1% PAT margin, improving from last year.
Kaynes also recorded 49% revenue growth over the first nine months of FY25, with revenues reaching ₹1,737.3 crore.
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Orderbook and future revenue outlook
Despite short-term execution delays, Kaynes Technology’s orderbook continues to grow, rising from ₹3,798 crore in Q3 FY24 to ₹6,047 crore in Q3 FY25.
FY26 guidance:
- Revenue expected at ₹4,500 crore
- Margins projected to exceed 15%
This suggests strong long-term growth potential, but the short-term execution challenges are impacting market sentiment.
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Why did the stock crash despite strong earnings?
1. Revenue guidance cut for FY25
Kaynes lowered its revenue target by ₹200 crore, from ₹3,000 crore to ₹2,800 crore. Investors see this as a sign of growth slowdown, leading to a negative market reaction.
2. Execution delays in the industrials segment
The company couldn’t complete ₹100 crore worth of orders in Q3 FY25, pushing them into Q4. While this is a temporary issue, it contributed to the stock sell-off.
3. High valuation concerns
Before the drop, Kaynes Technology’s stock had risen 83% in the past year. After peaking at ₹7,822, it has now fallen 40% from its high, making investors cautious about further downside risks.
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Brokerage and analyst views on Kaynes Technology stock
Mixed opinions from analysts
While the long-term growth outlook remains positive, analysts have diverging views on the stock after the guidance cut.
| Analyst | View | Recommendation |
| Mehta Equities | Bearish | Exit on pullback towards ₹5,000 – ₹5,100 |
| CNBC-TV18 | Neutral | Short-term weakness but long-term growth intact |
Technical outlook: Should you exit?
According to technical analysts, the stock has broken its major support level of ₹4,566.
- If it pulls back towards ₹5,000 – ₹5,100, analysts suggest exiting.
- If it continues falling, the next support level is ₹4,000.
Future outlook: Is Kaynes Technology a long-term buy?
Despite the stock correction, Kaynes remains a strong player in India’s electronics and semiconductor manufacturing space.
Reasons to be bullish on Kaynes Technology
- Strong orderbook of ₹6,047 crore, providing revenue visibility.
- FY26 revenue guidance of ₹4,500 crore, with higher margins.
- 30% YoY revenue growth in Q3, indicating long-term demand.
Reasons to be cautious
- Execution delays are a concern, with ₹100 crore worth of orders pushed to Q4.
- Valuation remains high, even after the correction.
- Short-term technical weakness suggests further downside is possible.
Verdict:
- Short-term traders should be cautious, as the stock remains under pressure.
- Long-term investors can consider accumulating on further dips, as the business fundamentals remain strong.
Final thoughts: Is the worst over for Kaynes Technology stock?
Kaynes Technology’s 19% share price drop was triggered by lowered revenue guidance and execution delays, despite solid earnings growth.
For short-term traders, technical weakness suggests further downside. However, for long-term investors, the company’s orderbook, strong margins, and FY26 guidance indicate that the growth story remains intact.
The key question now is whether the market has overreacted to the guidance cut, or if further corrections are expected.
Would you buy, sell, or hold Kaynes Technology at current levels? Let us know in the comments!
