Whereas there are greater than 5,000 firms listed on the Indian inventory exchanges right now, we’re going to discuss a powerhouse witnessing a strategic shift from being a pure EMS firm to turning into an built-in ESDM participant, whose choices have expanded from delivering circuit boards to next-gen semiconductor programs, Kavach security options to guard lives, aerospace-grade {hardware} for the skies, and past.
It’s none apart from Kaynes Know-how Ltd, which is an India-based electronics firm providing end-to-end and IoT-enabled built-in electronics manufacturing options. It operates throughout the ESDM Spectrum, offering design, course of engineering, product realisation, and life-cycle assist for markets akin to automotive, Industrial, aerospace, outer area, defence, medical, railways, IoT, and others.
It delivers each OEM (turnkey & box-build) and ODM companies, inclusive of PCBA assemblies, cable harnesses, plastic moulding, testing {hardware}, firmware/software program design, and many others. It has round 21 superior manufacturing & design services serving over 500+ clients throughout 30+ international locations.
Itemizing & Inventory Efficiency
The shares of Kaynes Know-how India Ltd hit the inventory exchanges on twenty second November 2022 at a value of Rs. 778 per share with a premium of 33 % towards the difficulty value of Rs. 587. With its share value hovering from Rs. 778 to Rs. 7,100 right now, Kaynes Know-how has delivered a return of 860% demonstrating distinctive progress, pushed by distinctive enterprise efficiency, strategic expansions, and a strong order ebook.
After seeing a touch of what the corporate does and the way it has carried out over time, let’s dig into its plans, latest strategic natural and inorganic expansions and extra which are shaping the corporate’s future throughout numerous verticals.
NextGen Semiconductor
Trade Overview and Capex Allocation
Firstly, coming to probably the most talked about and quickly evolving sector of latest instances, pushed by formidable authorities initiatives and vital personal investments, is the Semiconductor sector, valued at round $38 billion in 2023 and projected to develop to $45–50 billion by the top of 2025. Via additional enlargement, it’s anticipated to succeed in $100–110 billion by 2030, with India envisioning to seize about 11% of the worldwide semiconductor market by 2030, up from about 6.6%.
Taking a look at India’s future semiconductor potential and potent integration with enterprise, Kaynes Know-how India Ltd entered the area by establishing Kaynes Semicon Pvt Ltd in 2023 and introduced a capex of Rs. 3,400 Crores to determine the Semiconductor Outsourced Semiconductor Meeting and Take a look at(OSAT) facility in Sanand, Gujarat.
To assist the initiative as a part of the India Semiconductor Mission (ISM) the Authorities authorized a Rs. 76,000 Crores assist scheme, from which Kaynes Semicon was authorized for a 50% incentive in addition to Rs. 661 Crore assist by the Gujarat govt, taking the whole assist to 70% of the mission which might be incentivised following profitable commissioning of the plant.
Operations, Strategic Acquisitions & Future Outlook
The OSAT plant has begun pilot operations, industrial scale deliveries are anticipated to start by October and full mass manufacturing by January 2026, with an anticipated capability of ~6.3 million chips per day, and projected income of Rs. 100 Crores. Out of the Rs. 3,400 Crore capex, 50% be utilised by FY27, and the remaining can be utilised primarily based on additional developments and shopper acquisitions.
At current, Kaynes Semicon has partnered with a number of main semiconductor gamers, akin to US Know-how Worldwide, Lightspeed Photonics, Aptos Tech, AOI, and Alpha & Omega Semiconductor(AOS), to give attention to semiconductor manufacturing, packaging, testing, know-how switch, and provide. Among the many above, US Know-how Worldwide Personal Restricted (UST) and AOS have acquired 10% and eight.25% respectively, in Kaynes Semicon.
It has MOUs signed with one other 4 purchasers, in addition to discussions for forging potential partnerships with bigger world semiconductor majors akin to Qualcomm, Broadcom, Intel, STMicroelectronics, ROHM Semiconductor, and Infineon to develop its shopper base.
Coming to Acquisitions, Kaynes Semicon has acquired the facility module manufacturing traces and associated manufacturing belongings of Fujitsu Common Electronics, Japan, targeted on high-reliability energy semiconductor modules for about Rs. 85 Crores, catering to automotive, industrial, and client sectors the place energy modules are vital elements.
Whereas Kaynes took over the manufacturing traces, Larsen & Toubro Semiconductor Applied sciences (LTSCT), an entirely owned subsidiary of Larsen & Toubro, acquired the facility module design belongings and mental property from Fujitsu Common Electronics Restricted.
Kaynes Semicon advantages from this deal because the manufacturing services associated to the acquired enterprise had been acquired by Kaynes, which can function the contract producer for LTSCT, thus getting access to cutting-edge course of traces, world purchasers, and experience from each Fujitsu and L&T, enormously enhancing its manufacturing footprint and technological functionality in energy modules
Additional, Kaynes Know-how India Restricted acquired a 13.2% stake in Mixx Applied sciences Inc, a US-based deeptech semiconductor startup, for $3 million in January 2024, as a part of the seed funding spherical, to determine itself as a” silicon to programs” producer for synthetic intelligence (AI) and high-performance computing infrastructure.
This permits Kaynes Semicon entry to superior photonic circuit design and packaging applied sciences, essential for next-generation semiconductor options in synthetic intelligence (AI) and high-performance computing, as Mixx Applied sciences specialises in enabling three-dimensional scalability for AI and HPC purposes, serving quickly rising sectors like generative AI, knowledge facilities, industrial automation, and automotive electronics.
Newest CEO Outlook & Potential IPO
Raghu Panicker, CEO, Kaynes Semicon, commented that Kaynes Semicon has aggressive enlargement plans with the corporate investing near $20 million in analysis and improvement (R&D) in FY26 and goals to attain a income goal of Rs. 100 crore by this fiscal 12 months.
He continued, “Within the subsequent two years, we intention to change into a $100 million firm, and over the next three years, we plan to construct a fabrication facility or a compound fab, together with a devoted design lab. We intend to take a position practically $150 million in cutting-edge applied sciences akin to silicon photonics, 2.5D, and 3D ICs inside the subsequent 12 months.
With momentum rising behind indigenous GPU improvement, we additionally plan to enter that area inside the two-year horizon. An IPO is feasible inside three years. We envision evolving into an authentic design producer (ODM), which is our plan for the subsequent part.”
Kavach Programs
Transferring to the subsequent section that’s been in focus in latest instances is the Kavach Programs i.e., the indigenously developed Automated Prepare Safety (ATP) system designed to considerably improve railway security to forestall prepare collisions.
In India, the railway gear market, which incorporates security programs, was valued at USD 12.31 billion in 2024 and is forecasted to develop to USD 15.9 billion by 2030, with a CAGR of three.6%.
Adopted by latest prepare incidents, India’s present plans for the Kavach Automated Prepare Safety system contain deploying it throughout about 15,000 route kilometres and becoming it on 20,000 locomotives by 2030, with Rs. 1,673 Crores allotted for FY25-26.
Contemplating the business potential, Kaynes Tech determined to enter the Kavach Programs by way of the acquisition of a controlling 54% stake in Sensonic GmbH, Austria, specializing in superior railway infrastructure monitoring utilizing fiber optic sensing know-how mixed with synthetic intelligence and machine studying, providing monitor situation monitoring, landslide detection, safety, and extra.
The Kavach improvement program is progressing properly with designs primarily based on German know-how and is at the moment nearing pilot Implementation. The mandatory clearances can be acquired shortly, and industrial operations will start quickly thereafter.
Kaynes Know-how is focusing on to seize a 15% market share with a income potential of Rs. 2,000 Crores throughout 4-5 years. The railway section is claimed to contribute 10-12% of the whole gross sales by 12 months’s finish and additional proceed progress & improvement whereas integrating it with present enterprise and strengthening its portfolio and attain.
Good Meters
As a part of strategic initiatives to diversify past its core semiconductor and electronics manufacturing enterprise, faucet into the robust government-driven push for good grid and power effectivity options, Kaynes Know-how India Ltd entered the good meter section in 2023-24.
The Indian good meter market is projected for strong progress, with its measurement anticipated to succeed in roughly USD 763.2 million by 2031, rising from round USD 250.7 million in 2023 at a compound annual progress fee (CAGR) of about 14.9%, and the federal government plans to interchange ~250 million standard electrical energy meters with good meters by 2027. As of 2025, round 14% of the goal has been achieved, signalling bigger potential penetration alternatives nonetheless out there.
Kaynes began manufacturing and supplying good meters to L&T and Iskraemeco in 2023, and additional expanded by inaugurating a sensible meter manufacturing facility in Hyderabad in 2024, over a land parcel of 46 acres, with an annual capability of 4 million good meters, to change into one of many largest good meter producers in India.
Kaynes is projecting to seize a 15-20percentmarket share and generate a minimal of Rs. 1,000-2,000 Crores yearly, with plans to develop the manufacturing capability to 10 million good meters per 12 months, catering to Superior Metering Infrastructure Service Suppliers (AMISPs).
To additional strengthen its capabilities, it has made strategic partnerships with many gamers, together with Brightgrid Applied sciences, a outstanding participant in India’s good metering sector, which holds substantial orders for good meters from numerous states and electrical energy boards throughout India.
Coming to the most recent developments, Kaynes acquired a 100% controlling stake for Rs. 42 Crores in Iskraemeco India Personal Restricted, a Good Meter Options and Providers Supplier, which is a subsidiary of Iskraemeco, a worldwide chief in power and water effectivity, headquartered in Slovenia.
Aerospace, Satellite tv for pc, Automotive, EV, and others
Adopted by main developments throughout the Semiconductor, Kavach programs and good meters, Kaynes Know-how India is making strikes throughout booming sectors like Aerospace, Satellite tv for pc, Automotive, EV, and lots of others.
Not too long ago, it shaped a brand new WOS named Kaynes Area Applied sciences Personal Restricted to design, develop, and manufacture satellites of all courses and mission-specific payloads for numerous purposes akin to communication, Earth commentary, defence, and scientific analysis. It is going to additionally create modular satellite tv for pc platforms and indigenous launch automobiles for numerous orbits, specializing in cost-effective, reusable, and sustainable applied sciences
Moreover, Kaynes has strengthened its aerospace and defence capabilities by way of acquisitions, together with a 76% stake every in Aerocaliph Elements and Cryo Precision Applied sciences, each aerospace producers, and an 11.13% stake in Tranzmeo IT Options, a deep-tech firm specializing in clever fiber-optic sensing networks with purposes in defence and infrastructure.
Coming to the enterprise entrance, Kaynes makes simply 1-2% of its income from aerospace, which is claimed to extend to round 8%. It’s adopted by onboarding numerous purchasers and receiving work orders from massive OEMs, one of many largest being $10 million.
EMS & PCB
Kaynes Know-how has made two strategic acquisitions, i.e., August Electronics in Canada and Digicom Electronics in California, to strengthen its Electronics Manufacturing Providers (EMS) footprint internationally and supply scalable manufacturing options spanning from prototyping to mass manufacturing for numerous industries, together with automotive, aerospace, medical, power, and telecom.
Kaynes Know-how can be establishing a Excessive-Density Interconnect (HDI) PCB plant in Chennai to supply superior multi-layered circuit boards, with constructing building full and operational readiness anticipated by January 2026.
Alongside, it has just lately signed an Rs. 5,000 Cr MoU with the Authorities of Tamil Nadu targeted on PCB manufacturing, strengthening its EMS place, catering to complicated, high-precision electronics for sectors like automotive, aerospace, and defence, resulting in high-margin enterprise.
As every day passes, Kaynes Know-how India is making strides throughout numerous verticals, together with automotive, aerospace and defence, medical gadgets, railways, IoT options, and industrial electronics, every demonstrating strong progress pushed by strategic investments and robust shopper relationships, making it a noteworthy participant to search for.
Financials & Future Outlook
Kaynes Know-how India Restricted’s income has grown by 51 % from Rs. 1,805 Crores in FY24 to Rs. 2,722 Crores in FY25, accompanied by income of Rs. 183 Crores to Rs. 293 Crores.
Its income and revenue have grown at a 5-year CAGR of 49 % and 95 %, respectively and in FY25 it has delivered an OPM of 15 %, an NPM of 11 % and an EPS of Rs. 45.84. It additionally has a strong order ebook of Rs. 7,400 Crores.
Web working capital days for Q1FY26 stood at about 132 days from 87 days, with stock going up from 113 to 115. The rise in working capital days is as a result of receivables of Rs. 350 Crores acquired by way of the acquisition of August Electronics.
The administration is taking measures, together with working with suppliers to inventory stock domestically, in order that the burden to fund the stock, not less than the majority of the stock, is diminished until it will get balanced out. Kaynes expects a greater than 100 days of WC days and to cut back the working capital to 70 days by FY26 if the extraordinary merchandise is handled.
The administration of Kaynes Know-how India Restricted has given an outlook to attain a income goal of $1 Billion by 2028 and $ 2Billion by FY30 pushed by expansions in its outsourced semiconductor meeting and check (OSAT) and PC (printed circuit) board companies.
With ongoing developments and a promising future outlook, Kaynes Know-how stands out as a real gem in India’s EMS area, with good diversification throughout industrials, automotive, aerospace & defence, railways, semiconductor and good metering, actually incomes the title: “Jack of all trades, grasp of none, however oftentimes higher than grasp of 1.”
Written by Bharath Ok.S
Disclaimer
The views and funding suggestions expressed by funding consultants/broking homes/ranking businesses on tradebrains.in are their very own, and never that of the web site or its administration. Investing in equities poses a danger of monetary losses. Traders should subsequently train due warning whereas investing or buying and selling in shares. Commerce Brains Applied sciences Personal Restricted or the writer will not be responsible for any losses brought on because of the choice primarily based on this text. Please seek the advice of your funding advisor earlier than investing.
