Stock Crash: One report and the stock crashed, losing ₹300 in seconds, FIIs also sold crores of shares.

News Topical, Digital Desk : The stock of the massive company with a market cap of ₹35,000 crores fell sharply today. This is due to the latest report by Kotak Institutional Equities, which raises serious questions about the company's corporate governance, disclosure standards, cash flow, and accounting practices. The report states that the company's annual report contains several points that could be a cause for concern for investors, especially retail shareholders, who value transparency the most. The stock opened at ₹5,307.00 in the morning, compared to a closing price of ₹5,307.00. Subsequently, the stock fell by more than ₹300. At this time, i.e., 2:30 pm, the stock fell 6%.

The stock has fallen by more than -6 percent in a week. It has fallen by -20 percent in a year. The share of FIIs is also continuously decreasing, that is, they are selling the shares. Compared to December 2024, the share has fallen from 14.84 percent in September 2025 to 10.71 percent. This company which is currently at 52-week low, Kaynes Technology is a design-to-manufacturing electronics partner, which designs and manufactures and maintains complex electronic products and IoT solutions for OEMs on a large scale. What is there in the report - According to Kotak's report - a receivable of ₹45.8 crore is stuck in the books of the company's subsidiary Iskraemeco for more than a year - and this amount is to come from the parent company only. This indicates two things - the money is not being returned on time, secondly the internal financial discipline is weak. Furthermore, contingent liabilities are rising rapidly. In 2025, the company's contingent liabilities have risen to ₹520 crore, representing 18% of Kaynes' net worth. This large number is enough to scare retail investors—as contingent liabilities could become a major source of pressure in the future. There 's also the risk of receivable discounting and provisioning. The report states that receivable discounting and provisioning can directly impact both a company's margins and profitability. Meaning, profits could decline and working capital could be further strained. Furthermore, Kaynes' average borrowing cost in FY2025 was 17.7%—considered unusually high for the manufacturing sector. High borrowing costs indicate that the company has taken on expensive debt. Low net margins, weak cash flow. According to Kotak, the company has capitalized ₹1.8 billion (₹180 crore) in technical know-how, designs and prototypes in FY2025 – which is 6.5% of revenue. This is unusually high and raises questions about accounting practices. Most worryingly – the company's cash conversion cycle has significantly lengthened in FY2025, with a massive increase of 119 days. This means that Kaynes is taking longer to recover cash – which increases liquidity risk.

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