Kaynes Tech shares fall up to 5% as Investec raises balance sheet concerns

Kaynes Tech shares fall up to 5% as Investec raises balance sheet concerns

Kaynes Technology India shares fell up to 5% on August 31 after domestic brokerage Investec highlighted balance sheet concerns.

"Receivables for Iskraemeco ballooned, its payables to Kaynes Electronics Manufacturing also rose by a similar amount in FY26. This makes us question whether a potential divestment of Iskraemeco would resolve Kaynes’ cash flow issues," said the brokerage.

Smart meter business likely contributed 40% to Kaynes’ consolidate EBITDA. A potential divestment will likely impair Kaynes’ core EMS profitability materially, the brokerage said, reported NDTV-Profit.

Sharp increase in consolidated receivables was despite bill discounting rising from Rs 110 crore to Rs 460 crore in FY26, the brokerage added.

Fixing balance sheet without impairing P&L is difficult, Investec said.

At 11:55 am on August 31, Kaynes Tech shares were trading 4.6% lower at Rs 3,758.7 apiece.

Fixed asset turns also deteriorated, with steep rise in intangibles, which is likely to result in higher amortization charge going forward, the brokerage said.

Investec said the company incurred only Rs 900 crore capex in OSAT/Bare PCB and extended corporate guarantees of more than Rs 1,900 crore for them.

Headquartered in Mysore, the company spans the full Electronics System Design and Manufacturing (ESDM) value chain, providing engineering, layout design, component sourcing, testing, and lifecycle support across diverse sectors.

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