Why did Kaynes Technology shares crash over 19% today and what should investors do now?

Kaynes Technology India shares plunged over 19 per cent on Thursday after the company reported mixed March quarter results and brokerages flagged concerns over weak revenue performance, margin pressure and elevated working capital levels.

At the time of writing this report at 10:20 am, the stock was trading 17 per cent down to Rs 3,464.90, wiping out a significant portion of investor wealth.

The sharp decline came after the company’s Q4 FY26 earnings missed both company guidance and Street expectations on several operational parameters.

Revenue rises, but profit declines

Kaynes Technology reported a 26.2 per cent year-on-year rise in revenue to Rs 1,242.6 crore for the March 2026 quarter. However, net profit declined 21.5 per cent to Rs 91.2 crore due to higher expenses and margin contraction. EBITDA margin slipped to 15.6 per cent during the quarter.

Stock down sharply from peak levels

The stock has been under pressure for some time and has now corrected sharply from its peak levels. Kaynes Technology touched a 52-week high of Rs 7,705 on October 7, 2025, while the stock hit a 52-week low of Rs 3,294.90 on January 27, 2026.

At the current price of Rs 3,464.90, the stock is down Rs 4,240.10 or nearly 55 per cent from its 52-week high.

On a one-year basis, the stock has declined 45.26 per cent. It has fallen 20.98 per cent in the past week and over 10 per cent in the last month. Despite the recent correction, the stock has still delivered multibagger returns of around 239.70 per cent over the past three years.

The company currently has a market capitalisation of Rs 23,083 crore and is part of the Nifty Smallcap 100 index under the industrial products category.

JP Morgan cuts rating and target price

Brokerage JP Morgan downgraded the stock to “Neutral” from “Overweight” and sharply cut its target price to Rs 4,000 from Rs 6,000 following the earnings announcement.

According to the brokerage, Kaynes missed its own fourth-quarter revenue guidance by 27 per cent and also fell short of lowered Street and JP Morgan estimates by 18 per cent and 13 per cent, respectively. JP Morgan noted that net working capital days remained elevated at 125 days compared with the company’s guidance of 85 days.

The brokerage said it is cutting earnings estimates by 12-17 per cent over the next two years due to a weaker outlook across the company’s core EMS, OSAT and PCB businesses. It also reduced the valuation multiple for the core EMS business to 33 times from 45 times earlier.

JP Morgan, however, said it still expects strong revenue and earnings CAGR of 40-45 per cent over FY26-28, led by ramp-up in OSAT and PCB operations. Still, it cautioned that the stock may remain a “show me” story until the gap between company guidance and actual execution narrows.

CLSA flags balance sheet concerns

Meanwhile, CLSA maintained its “Outperform” rating on the stock with a target price of Rs 4,200, but also flagged near-term concerns.

The brokerage said the company’s fourth-quarter performance missed expectations on both revenue and operational metrics. Revenue for the quarter came in at Rs 12.4 billion, lower than CLSA’s estimate of Rs 15.7 billion and significantly below the company's guidance of Rs 17 billion.

CLSA further highlighted that EBITDA margins declined 150 basis points year-on-year to 15.6 per cent, compared with its estimate of 16.5 per cent.

The brokerage also expressed concerns over deterioration in the balance sheet. Working capital days increased by 85 days year-on-year, while net debt stood at Rs 711 million. CLSA noted that balance sheet stress was one of the key concerns heading into the results.