Kaynes Technology Shares Surge on Robust Q2 Performance

by | Nov 1, 2024 | 0 comments

Shares in Kaynes Technology India jumped 6% as the company presented an excellent Q2 performance report. Consolidated net profit for the quarter was Rs 60.2 crore, that is a rise of 86% on a YoY basis. The operating revenue was Rs 572.1 crore. Year-over-year growth at this level is at a respectable 59%. Thus, there is a healthy cash generation in the September-end quarter of 2024 as well. As on 9:18 AM, it is trading at Rs 5,498, having moved up 5% to turn into one of the best performers today in the market. The stock of Kaynes Technology has soared more than double since the start of the year, and it has easily outshone the Nifty 50, which returned nearly 13% over the same period.

Important Financial Points of Q2FY25

Net profit growth and revenue growth of the company were just outstanding. Even the EBITDA has increased by an impressive 68 percent year-over-year at Rs 82.1 crore for the company. This is from enhanced efficiencies in cost of operations as captured at 83 basis point expansion to 14.4%, thus enhancing further. There is considerable revenue clarity for FY25 going into FY26, too with the Rs 5,422.8 crore the order book at Q2FY25 end. For instance, if Q1 FY25 numbers came at Rs 5,038.6 crore.

As of September 30, 2024, our order book stood at Rs 5,422.8 crore. This gives us confidence to sustain growth and meet revenue targets for the current year, says Ramesh Kunhikannan, Managing Director & Promoter of Kaynes Technology.

Working Capital and Operational Efficiency Improve

Kaynes Technology improved its net working capital days to 108 from 119 in the same period last year, a clear sign of an improvement in the capital management plan. This is an evidence of the proper management that Kaynes is undertaking towards handling the operational expenses and managing the inventory and cash collection from the customers for improving the balance sheet as well as healthier cash flows.

Kaynes Technology: Leader in the Manufacturing of Electronics under Integration

Kaynes Technology is one of the leading players in the electronics manufacturing sector, offering a comprehensive suite of IoT-enabled services under the Electronics System and Design Manufacturing (ESDM) umbrella. Kaynes Technology has been offering end-to-end solutions that range from conceptual design to process engineering, integrated manufacturing, and lifecycle support for over three decades. The company supports diversified sectors that include: automotive, industrial, aerospace, space, strategic electronics, medical, railways, IoT, and IT. The company, therefore has established great goodwill on matters of quality and reliability in front of the customers.

Strategic investments in high-growth potential sectors

Kaynes Technology has been investing in high-potential and high-margin segments to achieve steady growth. “We are continuing to invest in high-potential segments, and we expect these to help us maintain momentum and position Kaynes as a differentiated player in the market,” Kunhikannan said. The company’s investment in increasing capabilities and venturing into new geographies has expanded its customer base, especially among large clients in high-growth sectors.

This firm is looking to grow and expand in the future.

With a healthy order book and strategic investments in growth-oriented sectors, Kaynes Technology is well prepared to face the future. The company has pegged its sights on new capabilities, geographic expansions, and customer base diversification, especially towards large clients and faster-growing market segments. This will generate long-term value and place Kaynes Technology as a prime stakeholder in the global ESDM sector.

Conclusion

Kaynes Technology’s excellent Q2 results highlight its growth trajectory and operational efficiency. The increasing order book, EBITDA margin improvement, and strategic investments in high-growth sectors will ensure revenue guidance for FY25. With an expanded capability and customer base, Kaynes Technology remains well-positioned as a leading integrated electronics manufacturer, providing high-value IoT-enabled solutions across multiple industries.

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