KPIT Tech shares fell as much as 11% on Tuesday, September 30, with no key fundamental trigger in sight for a fall.
Goldman Sachs expects KPIT Tech’s organic constant currency revenue to decline by 2% during the quarter, and its revenue in US Dollar terms to decline by 1% on a sequential basis.The Caresoft acquisition, which the company closed last month, should contribute around $4 million in additional revenue, according to Goldman Sachs.
On the flip side, JPMorgan has maintained its “overweight” stance on the stock and marginally cut its price target to ₹1,400 from ₹1,500 earlier.
The brokerage said that there is no fundamental reason for the stock to see such an extreme reaction as the one seen on Tuesday, but post this fall, it would recommend investors to buy the stock.”However, for investors to generate returns here will require some patience,” the brokerage wrote in its note.
JPMorgan expects financial year 2026 to be a washout year for KPIT Tech as it expects the company’s topline to decline by 1% on an organic basis. It expects growth to rebound to 12% and 16% in financial year 2027 and 2028 respectively.
As a result, the brokerage has cut its revenue and Earnings per Share (EPS) estimates by 4% to 6% over financial year 2026-2028 and also cut its target multiple by 10% to 36 times from 40 times earlier.
“We believe that the stock from here will be a ‘show me’ stock, and for it to rally, it will have to show some tangible proof points, such as sequential revenue growth acceleration every quarter and large deal wins,” the JPMorgan note said.
Out of the 23 analysts that have coverage on KPIT Tech, 15 of them have a “buy” rating, while four each have a “hold” and “sell” rating.
Shares of KPIT Tech recovered slightly from their intraday lows to end 8% lower on Tuesday, which was still the biggest single-day fall for the stock in the last 12 months.
Also Watch | Kishor patilCo-Founder, MD & CEO of KPIT Technologies, shares the company’s growth and margin outlook in an exclusive conversation with CNBC-TV18.
