Electronics manufacturing Co Kaynes Tech files for IPO

Electronics manufacturing Co Kaynes Tech files for IPO

Makes IoT solutions-enabled design-led products for OEMs

Kaynes Technology India Limited has filed its papers with SEBI for its initial public offering.

MUMBAI, Apr 16 (Ther CONNECT) - Mysore-based Kaynes Technology India Limited (KTIL), a leading end-to-end and IoT solutions enabled integrated electronics manufacturing player, has filed its draft red herring prospectus (DRHP) for its initial public offering (IPO).

The issue with a face value of Rs 10 per equity share consists of a fresh issue of equity shares aggregating to Rs 650 crore, and an offer for sale (OFS) of up to 7,200,000 equity shares by existing shareholders.

The OFS comprises about 3,700,000 equity shares by promoter Ramesh Kunhikannan and over 3,500,000 equity shares by investor Freny Firoze Irani. The offer also includes a reservation of up to Rs 1.5 crore for subscription by eligible employees.

The company, in consultation with the lead bankers to the issue may consider a further issue of equity shares including a rights issue, private placement, preferential offer, or any other method aggregating up to Rs 130 crore. If such placement is completed, the fresh issue size will be reduced.

The Company will use the net proceeds about Rs 130 crore will be sued for settling debt, Rs 98.93 crore for funding capex at its Mysore and Manesar facilities, up to Rs 149.30 crore for investment in subsidiary Kaynes Electronics and for setting up a new facility at Chamarajanagar, up to Rs 114.74 crore for funding working capital requirement and general corporate proposes.

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 business, is the company's Promoter and Managing Director. Kaynes was one of the first companies in India to offer design-led electronics production to original equipment manufacturers (OEMs) using mature embedded capabilities, according to a Frost & Sullivan report commissioned by the company. Among the listed space, Kaynes competes with Dixon Technologies Limited and Amber Enterprises Limited as mentioned in the DRHP.

Kaynes has more than 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, nuclear, medical, railways, and Internet of Things (IoT) industries,

KTIL has eight strategically positioned production plants 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 has a total capacity of approximately 600 million components as of December 31, 2021, with an exclusive line for Green Manufacturing compatible with Directive 2002/95/EC Restriction of Hazardous Substances ("RoHS"), as well as one design facility and two service centres.

As on March 31, 2022, Kaynes had an order book of Rs 1,516.63 crore, with orders from several customers across business verticals.

Kaynes is the first firm in the ESDM industry to be accredited for aerospace goods by the National Aerospace and Defense Contractors Accreditation Program (NADCAP), and one of the few Indian companies to maintain this accreditation. It has long-term partnerships with a big customer base that is diverse in terms of verticals and geographical locations. It served 313 customers in 20 countries for the nine months ended December 31, 2021, in verticals such as automotive, aerospace and defence, industrial, railways, medical, and IT / ITES.

Kaynes Technology clocked a profit of Rs 9.73 crore in the financial year FY21 against Rs 9.35 crore in the previous year, whereas revenue during the year FY21 increased 14.23% to Rs 420.63 crore from Rs 368.24 crore in the previous year, primarily driven by growth in the automotive and health care verticals.

Profit for the nine-month period ended December 2021 stood at Rs 21.82 crore on revenue of Rs 467.78 crore. Export sales accounted for 21.53 percent of revenues, Top 10 customers account for 51.92 percent, and revenue from the business verticals OEM – Turnkey Solutions – Box Build; OEM – Turnkey Solutions – Printed Circuit Board Assemblies; ODM; and Product Engineering and IoT Solutions account for 29.08 percent, 63.34 percent, 3.74 percent, and 3.84 percent, respectively, as of December 2021.

DAM Capital Advisors Limited and IIFL Securities Limited are the book-running lead managers and Link Intime India Private Limited is the registrar to the offer.

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