Kaynes Technology India (KAYNES) Q1 26/27 earnings summary

Executive summary

• Q1 FY27 revenue rose 40% year-over-year to INR 946 crores (₹9,460 million), driven by strong EMS business growth.

• EBITDA for Q1 FY27 was INR 147.6 crores with a margin of 15.6%, up 31% year-over-year, though margin declined by 120 bps.

• Net profit after tax for Q1 FY27 was ₹564 million, down 32% year-over-year, with net margin at 6.0%.

• Robust order book of over INR 8,900 crores (₹89,038 million), with significant new customer wins and international expansion.

• Strategic focus on EMS business, with conscious de-growth in smart metering to improve collections and balance sheet health.

Financial highlights

• EMS business revenue grew 53% year-over-year to INR 639 crores; overseas EMS revenue rose 327% to INR 102 crores.

• Smart metering business revenue declined 12% year-over-year to INR 204 crores.

• Negative operating cash flow of INR 259 crores, mainly due to inventory build-up and higher receivables.

• Inventory increased by INR 156 crores; receivables rose by INR 90 crores; net debt stands at approximately INR 800 crores.

• FY26 revenue reached ₹36,264 million, up 33% from FY25; FY26 EBITDA was ₹5,741 million with a 15.8% margin.

Outlook and guidance

• Commercial revenue from OSAT and PCB businesses expected to start in Q3 and Q4 FY27, targeting INR 450 crores full-year revenue.

• Management targets revenue growth at twice the market rate, maintaining flexibility due to market volatility.

• Margin pressures anticipated due to component shortages and cost inflation, with normalization expected in coming quarters.

• Macro headwinds include rupee depreciation, high inflation, and commodity price volatility.

• The group continues to focus on expansion and capital expenditure, with significant investments in new facilities and technology.