---
title: "Kaynes Tech & CG Power — Deep Dive Analysis"
ticker: "KAYNES:CGPOWER"
date: "2026-06-18"
tags: ["kaynes","cg-power","deep-dive"]
summary: "Comparative analysis of Kaynes and CG Power across growth, valuation, and execution risk."
model: "deepseek-chat"
---

# Kaynes Technology & CG Power — Deep Dive Analysis

**Date:** June 18, 2026  
**Model:** deepseek-chat (DeepSeek-V3)  
**Tags:**       

---

## Quick Verdict

| Criterion | Kaynes Tech | CG Power |
|-----------|:-----------:|:--------:|
| Technical Bias | Neutral | **Strong Buy** |
| Valuation | **Avoid** (Core P/E 271x) | **Premium justified** (ROCE 29.2%) |
| Institutional Flow | FII/DII selling | DIIs accumulating |
| Cash Flow | FCF +₹169 Cr (FY26) | FCF +₹477 Cr (FY26) |
| Recommendation | **Wait/₹2,800-3,000** | **Buy dips/₹880-920** |

---

## 1. Kaynes Technology India Ltd

### Key Stats (18 Jun 2026)
- CMP: ₹3,358 | MCap: ₹22,512 Cr | 52W: ₹7,705/₹2,995
- P/E: 87.9x (Core: **271x** — OI is 67% of PAT!)
- ROCE: 10.6% | ROE: 7.17% | D/E: 0.07
- Sales TTM: ₹2,128 Cr | PAT: ₹254 Cr
- 1Y Return: -43.2%

### Technical (TradingView, 1D)
- RSI: 52.11 (Neutral) | MACD: Buy (early)
- Above 10/20/30 MAs, **below 50/100/200** → partial recovery, not full trend
- Pivot: ₹3,556 | S1: ₹2,573 | R1: ₹4,116
- Performance: 1W +10%, 1M +7%, 3M -7%, 6M -18%, YTD -16%

### Concall Highlights (May 14, 2026)
**Key Quotes:**
- "Near-term top line did not fully meet expectations" → geopolitical disruption, West Asia conflict
- **Guidance credibility damaged:** Started year guiding ₹4,500 Cr → toned down to ₹4,000 Cr → actual ₹3,626 Cr
- Management now **refusing to give numeric guidance** → "we will better our growth... we don't want to attach a number"
- Analysts openly frustrated: *"The call is all over the place"* — Nitin Arora
- OSAT order outlook: ₹2,500 Cr over 5 years; PCB: ₹300-400 Cr in FY27; OSAT: ₹250-300 Cr in FY27
- Working capital: Core EMS improved from 83→53 days, but metering business (25% of rev) has 67% receivables
- **Smart meter business:** Received 35 lakh meter orders; management now says "we are not going to take any more orders like this"

### Cash Flow
- FY24: CFO -₹78 Cr, FCF -₹213 Cr
- FY25: CFO ₹65 Cr, FCF -₹731 Cr
- **FY26: CFO ₹247 Cr, FCF +₹169 Cr** ← first positive FCF since FY22

### Risk Flags
- 🔴 **Other Income 67% of PAT** → Core earnings just ₹83 Cr
- 🔴 **Promoters -10.1% over 3 years** (Screener CON)
- 🔴 **FIIs -49% from peak, DIIs -17.6%**
- 🔴 **WC days 267→486** (Screener data)
- 🔴 **Delivery avg 28%** → speculative churn, not accumulation

---

## 2. CG Power & Industrial Solutions Ltd

### Key Stats (18 Jun 2026)
- CMP: ₹950 | MCap: ₹1,49,592 Cr | 52W: ₹971/₹526
- P/E: 111x (Core: 136x — OI is 16.6% of PAT)
- ROCE: **29.2%** | ROE: **21.9%** | D/E: 0.01
- Sales TTM: ₹11,331 Cr | PAT: ₹1,317 Cr
- 1Y Return: **+40.9%**
- Promoter: Murugappa Group (via Tube Investments)

### Technical (TradingView, 1D)
- RSI: 64.09 | MACD: Buy | **Summary: Strong Buy** (14 Buy, 9 Neutral, 3 Sell)
- **ALL 12 MAs in Buy mode** → textbook golden EMA stack
- Near 52W high (₹971) — no resistance above
- Concern: Volume -52.8% below 20d avg
- Performance: 1W +5.5%, 1M +17%, 3M +36%, 6M +44%, YTD +46%

### Concall Highlights (May 6, 2026)
**Key Quotes (Amar Kaul, MD & CEO):**
- "Record fiscal year" — highest ever revenue, order book, PBT
- Power Systems: Q4 sales **+50% YoY!** → PBIT margin 23.8% (+287 bps)
- Order book ₹15,719 Cr **+59% YoY** → strong FY27 visibility
- ₹900 Cr ($99M) US data centre transformer order — single largest export
- CG Semi OSAT: G1 operational, G2 under construction (CY2026)
- ₹3,000 Cr QIP oversubscribed 3x

### Key Metrics
- **3 consecutive years of positive FCF** → ₹779 Cr (FY24), ₹709 Cr (FY25), ₹477 Cr (FY26)
- FY26 FCF lower due to ₹3,535 Cr capex (OSAT + expansion) — **growth capex, not distress**
- DIIs **3.4x increase** in 4 years (5.28% → 18.01%)
- ₹3.50/sh dividend recommended for FY26

### Risk Flags
- 🔴 P/E 111x leaves no room for error
- 🟡 OSAT drag ₹111 Cr in FY26
- 🟡 Volume thinning on rally
- 🟡 WC days 39.7→81.7 (₹2,536 Cr locked)

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## Verdict

**🏆 CG Power > Kaynes Tech**

CG Power: Buy on dips (₹880-920). Quality compounder with superior ROCE, strong order book, institutional support, and Murugappa governance. Valuation premium is justified by execution — but requires quarterly monitoring.

Kaynes Tech: Avoid at current levels. Compelling OSAT/PCB narrative destroyed by broken guidance, promoter selling, and 271x core P/E. Re-evaluate at ₹2,800-3,000 after 2 quarters of OSAT revenue data.

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**📂 Related Notes:** [[Kaynes-Technology-Overview]] [[CG-Power-Q4-FY26-Results]] [[EMS-Sector-Overview]]