In early Tuesday trading, Kaynes Technology India's shares increased by more than 8% following the company's announcement that the Union Cabinet had accepted Kaynes Semicon Private Limited's plan to establish a semiconductor facility in Sanand, Gujarat.
Kaynes Semicon Private Limited is a fully owned subsidiary of Kaynes Technology India. An estimated Rs 3,307 crore would be invested in the establishment of the planned plant. This facility can produce 60 lakh chips in a day. From its previous closing on the BSE of Rs 4656.95, Kaynes Technology's shares increased 8.5% to Rs 5052.25. The company's market value was Rs 30,964 crore. In a year, the stock has increased by 143%.
With a one-year beta of 1.2, Kaynes Technology shares show extremely high volatility during that time. Technically speaking, Kaynes Technology's relative strength index (RSI) is 50.2, indicating that it is not trading in the overbought or oversold areas.
The 5 day, 10 day, 20 day, 30 day, 50 day, 100 day, 150 day, and 200 day moving averages are all being exceeded by the price of Kaynes Technology shares.
In a statement to bourses, Kaynes Tech stated, "The chips produced in this unit will cater to a wide variety of applications which include segments such as industrial, automotive, electric vehicles, consumer electronics, information technology telecom, mobile phones, etc."
The stock is the subject of an add call by Kotak Institutional Equities, with a price objective of Rs 4,950. According to the brokerage, getting permission to establish an OSAT facility opens the door for the business to join the semiconductor value chain.
"Its immediate goal will be to increase execution. But in the medium run, Kotak stated, "the emphasis would be on moving rev toward advanced packaging solutions."
With a price objective of Rs 3,845, global brokerage Morgan Stanley is overweight on the stock. The company's application to establish a semiconductor facility in Gujarat has been approved by the government.
This is good because investor concerns were still there while awaiting government permission. According to Morgan Stanley, the OSAT collaboration might provide an additional Rs 30-35 billion in potential income by F30 (asset turns of 1-1.3x).
The main business activities of Kaynes Technology India are the design and production of cutting-edge electronic modules and solutions for a variety of sectors.
