Kaynes Technologies Shares Recover 6% After Steep 40% Fall Amid Accounting Disclosure Issues

In the past few days, the Kaynes Technologies share price saw a huge price correction on the back of issues regarding accounting disclosures in FY25 annual report mentioned in the Kotak Institutional Report which caused fear among the market participants.

Kotak Institutional Report Sparked Concerns

Kaynes Technology India drew sharp investor attention when Kotak Institutional Equities released a report on December 3, 2025, flagging potential accounting inconsistencies and disclosure lapses in the company's FY25 annual report.

Kotak highlighted issues in goodwill recognition from the Iskraemeco acquisition, where Rs 114 crore goodwill went unrecognized despite the Rs 88.3 crore deal, alongside concerns over capitalized intangible assets worth Rs 180 crore. It also questioned rising contingent liabilities to Rs 520 crore (18% of net worth), related-party transactions, borrowing costs, receivables buildup, particularly in smart meters, implying governance risks and cash flow pressures.

Management Clarifications

Kaynes management responded decisively on December 4, 2025, disapproved Kotak's claims as invalid and highlighting no ambiguities in financial data. The company detailed recognition of Iskraemeco customer contracts as amortizable intangibles under Ind AS 103, netting off goodwill, and attributed contingent liabilities mainly to performance bank guarantees (Rs 96.8 crore) and corporate guarantees for subsidiaries like Kaynes Electronics (Rs 122.5 crore). On December 8, 2025, the management clarified technical know-how capitalization from prototypes and development costs, noted receivables include long-term items with Rs 240 crore due soon, and affirmed stable 63% promoter holding with no dilution plans.

Stock Corrected from 52-Week Peak

Kaynes shares corrected sharply from their 52-week high of Rs 7,822 on January 1, 2025, and was trading somewhere around Rs 6,300 to Rs 6,700 until the Kotak report. Overall, the stock has corrected over 52% from its 52 week highs touching a 52 week low price of Rs 3,712.50 on December 9, 2025. With High volatility and volumes spiking, the profit-booking intensified despite clarifications, contrasting to the stock's three-year 430% surge. Currently, the stock has bounced back and trading around Rs 4,035 per share translate to an increase of 6% from its previous closing price.

Q2FY26 Delivered Robust Growth

Kaynes posted stellar Q2 FY26 results on November 7, 2025, with revenue surging 58.39% year-on-year to Rs 906 crore. Operational EBITDA jumped 80.48% to Rs 148 crores, expanding its margins to 16.33%, while profit after tax reached Rs 121.4 crore with 13.4% margin.

The order book increased to Rs 8,099.4 crore from Rs 5,422.8 crore YoY basis, bolstered by milestones like India's first commercial multi-chip module and approvals for PCB projects.

FY26 Outlook

During the Q2FY26 earnings call, management reaffirmed long-term targets of $1 billion revenue by FY28. They highlighted margin gains from productivity and cost controls across six verticals in the recent performance, and with H1 execution validating strategy amid strong customer wins.

Brokerage Price Targets

JPMorgan retains an 'Overweight' rating on Kaynes Technology with a target price of Rs 7,550, implying nearly 100% upside from recent lows around Rs 3,800, despite flagging working capital concerns and a bear case of Rs 4,900 as per multiple sources.

Macquarie uphold 'Outperform' rating at Rs 7,700, viewing management clarifications on the Kotak report as reasonable.

Investec sticks to 'Sell' with Rs 5,760 target, citing reliance on Iskraemeco metering and deteriorating working capital metrics in FY25 and H1FY26.