Kaynes Technology India Limited, an end-to-end and IoT solutions enabled integrated electronics manufacturing player, having capabilities across the entire spectrum of electronics system design and manufacturing services, has fixed the price band at Rs 559 to Rs 587 per Equity Share for its maiden public offer of Equity Shares.
The initial public offering of the Company will open on Thursday, November 10, 2022, for subscription and closes on Monday, November 14, 2022. Investors can bid for a minimum of 25 Equity Shares and in multiples of 25 Equity Shares thereafter.
The Offer is being made through the Book Building Process. The issue with a face value of Rs 10 per Equity Share consists of a fresh issue of Equity Shares aggregating to Rs 530 crore, and an offer for sale of up to 5,584,664 Equity Shares.
- IPO Opens on: Thursday, November 10, 2022
- IPO Closes on: Monday, November 14, 2022
- Price Band: Rs 559 to Rs 587 per Equity Share
- Face Value: Rs 10 each
- Offer for Sale: Aggregating to Rs 530 crore
- Bidding: Minimum of 25 Equity Shares and in multiples
Ramesh Kunhikannan, a technocrat founded Kaynes Technology as a sole proprietorship in 1989 and has over 33 years of expertise in the electronic manufacturing services industry, is the Company’s Promoter and Managing Director. Kaynes Technology was one of the first companies to offer design led electronics manufacturing to original equipment manufacturers using its mature embedded design capabilities. Among the listed space, Kaynes Technology competes with Dixon Technologies India Limited, Syrma SGS Technology Limited and Amber Enterprises India Limited.
Kaynes Technology has eight manufacturing facilities in India, in the states of Karnataka, Haryana, Himachal Pradesh, Tamil Nadu, and Uttarakhand, allowing it to service its customers efficiently and cost-effectively. It had a combined capacity to assemble over 1,500 million (on an annualized basis) components as of June 30, 2022, with an exclusive line for “Green Manufacturing” that is compliant with Directive 2002/95/EC Restriction of Hazardous Substances and under the manufacturing infrastructure includes one design facility and two service centres. As on June 30, 2022, Kaynes Technology had an order book of Rs 2,266.26 crore, with orders from several customers across business verticals.
Kaynes Technology is the first company in the ESDM industry to be accredited for aerospace products by the National Aerospace and Defense Contractors Accreditation Program and one of the few Indian companies to maintain this accreditation. It has long-term relationship with a large customer base that is diverse in terms of verticals and geographical locations. It served 229 customers in 21 countries for the three months ended June 30, 2022, in verticals such as automotive, aerospace and defence, industrial, railways, medical and IT / ITES.
For three months ended June 30, 2022, Kaynes derives its revenue from business segments which includes OEM – Turnkey Solutions – Box Build; OEM – Turnkey Solutions – Printed Circuit Board Assemblies; ODM; and Product Engineering and IoT Solutions representing 23.52%, 66.59%, 4.97% and 4.92% of the revenue from operations, respectively. Kaynes Technology clocked a profit after tax of Rs 41.68 crore in FY22 against Rs 9.73 crore in the previous year, whereas revenue during FY22 increased 67.90% to Rs 706.24 crore from Rs 420.63 crore in the previous year, primarily due to increase in sale of goods (net) and sale of services (net).
Profit after tax for the three-month period ended June 30, 2022 stood at Rs 10.05 crore on revenue from operations of Rs 199.27 crore. In the three months period ended June 30, 2022, the top 10 customers account for 62.81% of the revenue from operations.
Risks to Investors:
- Subsidiaries have contributed less than 10% to our revenue from operations during the Fiscal 2020, 2021 and 2022 and in the three months ended June 30, 2022.
- Its top 10 customers accounted for 53.61%, 46.03%, 51.02% and 62.81% of revenue from operations in Fiscal 2020, 2021 and 2022, and the three months ended June 30, 2022, respectively. Revenue contribution from top 1, top 5 and top 10 customers has fluctuated in the last three Fiscals. Further, there has been a decline in the proportion of new customers we have added in the last three Fiscals.
- Its top 3 manufacturing facilities accounted for 81.53% of revenue from operations in Fiscal 2022. Any slowdown, shutdown or disruption in our manufacturing facilities may lead to disruptions in our business and operations which could have an adverse effect on our business, results of operations, financial condition and cash flows.
- Company is reliant on the demand from various industries such as automotive, industrial, railways, medical, information technology, Internet of Things, aerospace and defense, of which automotive and industrial industries accounted for 63.36% of our revenue from operations in Fiscal 2022. Any downturn in these industries could have an adverse impact on our business, growth, and results of operations.
- The imported raw materials accounted for 64.46% of our total purchases of raw materials in Fiscal 2022. Any shortage or issues in timely availability of semiconductors or any particular semiconductor components required for the manufacturing of products or fluctuations in the exchange rate between the Rupee and other currencies, could affect our business, financial condition, results of operations and prospectus.