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Business News/ Photos / MOSL bullish on electronics manufacturing service; advises buying Kaynes Tech, Syrma SGS and more

MOSL bullish on electronics manufacturing service; advises buying Kaynes Tech, Syrma SGS and more

The Electronics Manufacturing Service (EMS) industry has evolved over the years, aided by increased outsourcing of manufacturing activities by OEMs. Recently, brokerage house Motilal Oswal initiated coverage on the space with 4 ‘buy’ calls and one ‘neutral’ recommendation. Let's take a look.

Kaynes Technology India: The brokerage has initiated coverage on the stock with a ‘buy’ call and a target price of  <span class='webrupee'>₹</span>3,100, indicating an upside of 16%. It is a prominent end-to-end and IoT-enabled integrated electronics manufacturer with strong order book growth (at 96% CAGR over FY20-23) and has a higher share of Box Build (~30% in FY23) and printed circuit board assembly (62%). Its revenue/EBITDA/ Adj. PAT are estimated to report a robust CAGR of 37%/43%/52% over FY23-FY26, driven by strong order book growth (at 32% CAGR) and improving margin profile, said MOSL. Listed in November last year, the stock has surged a massive 355% from its IPO price of  <span class='webrupee'>₹</span>587. (Photo: Courtesy Kaynes Technology Ltd website)

1/5Kaynes Technology India: The brokerage has initiated coverage on the stock with a ‘buy’ call and a target price of 3,100, indicating an upside of 16%. It is a prominent end-to-end and IoT-enabled integrated electronics manufacturer with strong order book growth (at 96% CAGR over FY20-23) and has a higher share of Box Build (~30% in FY23) and printed circuit board assembly (62%). Its revenue/EBITDA/ Adj. PAT are estimated to report a robust CAGR of 37%/43%/52% over FY23-FY26, driven by strong order book growth (at 32% CAGR) and improving margin profile, said MOSL. Listed in November last year, the stock has surged a massive 355% from its IPO price of 587. (Photo: Courtesy Kaynes Technology Ltd website)

Avalon Technologies: MOSL has initiated coverage on the stock with a ‘buy’ recommendation and a target price of  <span class='webrupee'>₹</span>730, implying a 38% upside. As per the brokerage, it is one of the leading vertically integrated EMS players in India and the only Indian company with a full-fledged manufacturing facility in the US. It has the highest Box Build share (47%) within the industry and it is expected to further increase with recent order wins. Its revenue/EBITDA/Adj. PAT is estimated to clock a CAGR of 23%/27%/45% over FY23-FY26, driven by strong order book growth (24% CAGR), it estimated. Listed in April this year, the stock has risen a little over 21 percent from its issue price of  <span class='webrupee'>₹</span>436.

2/5Avalon Technologies: MOSL has initiated coverage on the stock with a ‘buy’ recommendation and a target price of 730, implying a 38% upside. As per the brokerage, it is one of the leading vertically integrated EMS players in India and the only Indian company with a full-fledged manufacturing facility in the US. It has the highest Box Build share (47%) within the industry and it is expected to further increase with recent order wins. Its revenue/EBITDA/Adj. PAT is estimated to clock a CAGR of 23%/27%/45% over FY23-FY26, driven by strong order book growth (24% CAGR), it estimated. Listed in April this year, the stock has risen a little over 21 percent from its issue price of 436.

Syrma SGS Technology: The brokerage has initiated coverage on the stock with a ‘buy’ recommendation and a target price of  <span class='webrupee'>₹</span>775, which implies a 21% upside. It is a technology-focused engineering & design company serving diverse end-use industries like automotive, healthcare, consumer products, Industrial, IT and railways. Its revenue/EBITDA/ Adj. PAT would report a robust CAGR of 37%/45%/42% over FY23-FY26E, driven by strong order book, traction in end-user industries and improving margin profile, explained MOSL. The stock has given multibagger returns in the last 1 year as well as in 2023 YTD, up 123% and 125%, respectively.

3/5Syrma SGS Technology: The brokerage has initiated coverage on the stock with a ‘buy’ recommendation and a target price of 775, which implies a 21% upside. It is a technology-focused engineering & design company serving diverse end-use industries like automotive, healthcare, consumer products, Industrial, IT and railways. Its revenue/EBITDA/ Adj. PAT would report a robust CAGR of 37%/45%/42% over FY23-FY26E, driven by strong order book, traction in end-user industries and improving margin profile, explained MOSL. The stock has given multibagger returns in the last 1 year as well as in 2023 YTD, up 123% and 125%, respectively.

Cyient DLM: MOSL has initiated coverage on the stock with a ‘buy’ recommendation and a target price of  <span class='webrupee'>₹</span>870, indicating an upside of almost 27%. The brokerage noted that the firm is an integrated EMS company with a focus on the entire life cycle of a product. The company has over three decades of rich experience in developing high-mix, low-to-medium volumes of highly complex systems and services. The company’s strong parentage (promoter – Cyient) with global presence provides an edge over its peers, it added. Its revenue/EBITDA/Adj. PAT are estimated to report a robust CAGR of 40%/46%/83% over FY23-FY26, driven by a healthy order book-to-bill ratio of 2.6-2.9x over FY26 and improving margin profile, forecasts MOSL. Listed in July this year, the stock has soared 159% till date. (Photo: Courtesy Cyient DLM Limited website)

4/5Cyient DLM: MOSL has initiated coverage on the stock with a ‘buy’ recommendation and a target price of 870, indicating an upside of almost 27%. The brokerage noted that the firm is an integrated EMS company with a focus on the entire life cycle of a product. The company has over three decades of rich experience in developing high-mix, low-to-medium volumes of highly complex systems and services. The company’s strong parentage (promoter – Cyient) with global presence provides an edge over its peers, it added. Its revenue/EBITDA/Adj. PAT are estimated to report a robust CAGR of 40%/46%/83% over FY23-FY26, driven by a healthy order book-to-bill ratio of 2.6-2.9x over FY26 and improving margin profile, forecasts MOSL. Listed in July this year, the stock has soared 159% till date. (Photo: Courtesy Cyient DLM Limited website)

Data Patterns: The brokerage has initiated coverage on the stock with a ‘neutral’ call and a target price of  <span class='webrupee'>₹</span>2,270, indicating an upside of 12%. It is one of the fastest-growing (36% revenue CAGR over FY19-23) end-to-end integrated electronics solutions providers in the defense and aerospace sector with a wide presence across the spectrum (land, air, sea & space). Its revenue/EBITDA/Adj. PAT are estimated to report a robust CAGR of 33%/37%/40% over FY23-FY26, driven by a strong order book growth (at 27% CAGR) and improving margin profile, said MOSL. The stock has advanced 69% in the last 1 year and 82% in 2023 YTD.

5/5Data Patterns: The brokerage has initiated coverage on the stock with a ‘neutral’ call and a target price of 2,270, indicating an upside of 12%. It is one of the fastest-growing (36% revenue CAGR over FY19-23) end-to-end integrated electronics solutions providers in the defense and aerospace sector with a wide presence across the spectrum (land, air, sea & space). Its revenue/EBITDA/Adj. PAT are estimated to report a robust CAGR of 33%/37%/40% over FY23-FY26, driven by a strong order book growth (at 27% CAGR) and improving margin profile, said MOSL. The stock has advanced 69% in the last 1 year and 82% in 2023 YTD.

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