Synopsis:
Small cap stock hits 10 percent upper circuit today, after receiving approval for version 4.0 of its Kavach System.
A small-cap Company that manufactures and sells Safety Systems and Software services for Railways, is in the spotlight today after receiving approval for version 4.0 of its Kavach System.
With the market capitalization of Rs. 2,260.51 crore, the shares of Kernex Microsystems (India) Ltd is trading at Rs. 1,348.80, hitting an upper circuit of 10 percent from its previous day’s close price of Rs. 1,226.20 per equity share.
What’s the News?
Kernex Microsystems (India) Limited has received Research Designs and Standard Organization (RDSO) approval for version 4.0 of its Kavach System as of October 14, 2025. The company can now start delivering Kavach System Version 4.0 against accumulated orders from April 1, 2024, onwards, totaling Rs. 3,346.35 crore (including GST).
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About the Company & Others
Kernex Microsystems (India) Limited, founded in 1991 and based in Hyderabad, manufactures railway safety systems and provides software and engineering services in India and abroad. Its products include train collision avoidance systems, level crossing protection, warning devices, and passenger information systems, along with turnkey development, embedded software, and testing services.
A return on equity (ROE) of about 38 percent, a return on capital employed (ROCE) of about 23.8 percent and debt to equity ratio at 0.26 demonstrate the company’s financial position. At the moment, the company’s P/E ratio is 41.8x higher as compared to its industry P/E 36.7x.
In Q1FY26, Kernex Microsystems reported revenue of Rs. 55.93 crore, up 95 percent YoY from Rs. 28.68 crore in Q1FY25 but down 33 percent QoQ from Rs. 83.07 crore in Q4FY25. The company’s profit stood at Rs. 7.41 crore, rising 108 percent YoY from Rs. 3.57 crore but declining 77 percent QoQ from Rs. 32.53 crore, indicating strong annual growth despite a sequential slowdown.
Written by Akshay Sanghavi
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