Kaynes Technology Shares Down 42% in 2025. Should You Buy the Dip?

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Despite the benchmark indices hitting record highs, several stocks are languishing. Many of these have now fallen substantially from highs. One such stock is that of Kaynes Technology India.
The stock, which traded at Rs 7,598 on 1 January 2025, has fallen to Rs 4,358.6, a deep cut of Rs 42%.
In this editorial we tell you about the reasons for the same.
However, this is not a stock recommendation in any form.
About Kaynes Technology India
Kaynes Technology India is a leading end-to-end and IoT solutions-enabled integrated electronics manufacturer in India. The company's capabilities span across the entire spectrum of ESDM services.
The company has over three decades of experience in providing conceptual design, process engineering, integrated manufacturing and life cycle support for major players in the automotive, industrial, aerospace and defence, outer-space, medical, railways, internet of things ("IoT"), information technology ("IT") and other segments.
Kaynes Technology India has advanced manufacturing infrastructure that enable it to manufacture products at variable or flexible volumes across all industry verticals.
Why Kaynes Technology India Shares Are Down 42% in 2025
Let's now get into some probable reasons for the shares to plunge...
#1 A Kotak Instiutional Equities Report
One of the big reasons for the fall is a report by Kotak Institutional Equities raising several issues. One such issue pertains to goodwill recognition/reserve adjustments in acquisitions at the company being ambiguous.
The company has clarified that as per Ind AS 103, business combinations, previously unrecognised intangible assets, can be recognised as a part of acquisition accounting.
Since a major part of the consideration for this acquisition is for a contract that Iskraemeco has entered into, customer contracts can be recognised as an intangible asset and amortized over the term of the contract.
The company further added that the Intangible assets recognised was netted off with the goodwill. It states that considering the unique nature of these intangible assets, goodwill and other intangible assets are evaluated annually.
Another issue that has been raised in the report is that the year-end payables of Rs 3.2 bn to Kaynes Technology and Rs 1.8 bn to Kaynes Electronics Manufacturing and receivables of Rs 1.9 bn from Kaynes Technology are not reflected in the related-party disclosures of Kaynes Technology and Kaynes Electronics Manufacturing.
The company has clarified that these related party transactions were eliminated in the consolidated financial statements as per Indian Accounting Standards.
However, they were inadvertently not disclosed in the standalone financial statements. This has since been rectified and has been noted for future compliance. This transaction was part of the overall financial statement in both the entities.
A few more issues were raised by Kotak Institutional equities, which could have led to questions over transparency. This could be one of the reasons for the stock to fall.
#2 High Valuations
The other reason for the fall in the stock could be the numbers for Q2 FY26. Kaynes Technology India did report good numbers but the stock's valuations expectations were very high.
The company reported revenues of Rs 9,062 in Q2 FY26 from Rs 5,040 YoY. Net profits of Kaynes Technology India doubled to Rs 1,214 m from Rs 602 m.
The margins too improved with gross profit margins being placed at 16.3% from 14.4% YoY.
How Kaynes Technology India Share Price Has Performed Recently
In the past five trading sessions, Kaynes Technology India shares have declined 21%.
The stock touched its 52-week high of Rs 7,824.95 on 1 January 2025 and a 52-week low of Rs 3,835 on 11 February 2025.
Should You Consider the Stock of Kaynes Technology India?
The company has a strong orderbook of Rs 80,994 m as of 30 September 2025, providing good revenue visibility for H2 FY26 and beyond.
It has launched India's first manufactured IPM multi-chip module through its wholly owned subsidiary - Kaynes Semicon Private Limited.
Despite these positives, the recent 42% decline reflects disclosure inconsistencies and rising debtors. The company is benefiting from EMS sector tailwinds and order book growth, but short-term headwinds from governance issues could remain an overhang.
This is why it's important to do a thorough-research and adopt diversified approach in the markets before considering any specific stock.
Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.