Semiconductor stock on radar after company announces 60% revenue growth for FY25

Kaynes Technology Surges 25% in Two Days Post Q4FY24 Results and Promising Future Guidance

Kaynes Technology India Limited, a leading semiconductor stock and end-to-end IoT solutions-enabled integrated electronics manufacturer, saw its shares jump 25% in just two days after announcing its Q4FY24 results and future growth guidance, which projects a 60% revenue increase for FY25.

The company, with a market capitalization of Rs. 20,741 crores, hit the 5% upper circuit and closed on Saturday at Rs. 3,244.95, up from the previous day’s close of Rs. 3,090.45. Known for its electronics manufacturing services and future plans in semiconductor manufacturing, Kaynes Technology delivered a remarkable 25% return in just two trading sessions following the release of its Q4FY24 results and FY25 guidance.

Jairam Sampath, full-time Director & CFO, and Ramesh Kannan, MD & Promoter of Kaynes Technology, have set an ambitious target, aiming for a 60% revenue growth in FY25 and an increase in margins by more than 100 basis points this year.

The company’s order book surged from Rs. 3,789 crores in Q3FY24 to Rs. 4,115.2 crores in Q4FY24, marking a 9% quarter-on-quarter growth. Kaynes Technology holds a substantial order book in the aerospace segment and anticipates significant performance in the outer space segment, along with major export opportunities. The company expects an order pipeline of Rs. 2000-3000 crores in the next three quarters and projects revenues of Rs. 3000-4000 crores by FY30.

Kaynes Technology’s revenue from operations grew by 75% year-on-year, rising from Rs. 364.58 crores in Q4FY23 to Rs. 637.30 crores in Q4FY24. Quarter-on-quarter, it grew 25%, up from Rs. 509.29 crores in Q3FY24. Annually, the company generated revenue of Rs. 1,126.11 crores in FY23, which soared to Rs. 1,804.61 crores in FY24, indicating a 60% year-on-year growth.

Net profit nearly doubled, increasing by 97% from Rs. 41.28 crores in Q4FY23 to Rs. 81.25 crores in Q4FY24. It also grew 80% quarter-on-quarter, rising from Rs. 45.19 crores in Q3FY24 to Rs. 81.25 crores in Q4FY24. Annually, the net profit surged by 92.54%, from Rs. 95.19 crores in FY23 to Rs. 183.28 crores in FY24.

Kaynes Technology, renowned for its electronics manufacturing services, has a robust customer base that includes major players like Hitachi, Siemens, and Tonbo Imaging. The company offers a wide range of solutions, including box build, printed circuit board assemblies (PCBAs), ODM, product engineering, IoT solutions, smart metering technology, smart street lighting, and inverter technology. Additionally, it provides conceptual design and product engineering services.

The company serves various industries, including automotive, industrial, nuclear, medical, railway, aerospace and defense, outer space, IoT, information technology, and more. In FY24, the revenue breakdown across business verticals was 48% from Industrial+EV, 29% from Automotive, 11% from Railways, 7% from IoT/IT and other segments, 3% from Medical, and 3% from Aerospace & Strategic Electronics.

Furthering its expansion, Kaynes Technology is investing Rs. 2,800 crores to establish a semiconductor OSAT (Outsourced Semiconductor Assembly and Test) and compound semiconductor facility at Kongara Kalan near Hyderabad.