KPIT Tech shares jump 17% in two sessions and analysts expect more upside

KPIT Tech shares rose after the company raised its EBIT margin guidance for financial year 2025. The company now sees EBITDA margin over 21% from the earlier guidance of over 20.5%.

KPIT Tech has maintained its constant currency revenue growth guidance in the range of 18% to 22%.
For the quarter under review, the company posted a 20.4% surge in its net profit to ₹187 crore, while the topline rose 17.6% to ₹1,478 crore.

KPIT Tech’s Earnings Before Interest and Tax (EBIT) rose 22% to ₹254 crore, while margins saw an expansion of 60 basis points to 17.2%.

Global brokerage firm Bernstein has maintained an ‘Outperform’ rating on KPIT Technologies, with a target price of ₹1,580 per share. Bernstein’s price target implies a further 15% upside from yesterday’s closing levels on KPIT Tech.

The foreign brokerage wrote in its note that the company delivered a strong quarter despite weakness in Europe’s auto sector, with both growth and margin beats.

The growth was driven by Asia, including Japan, Korea, and India.

The company won deals worth $236 million during the quarter.

Co-founder, MD & CEO Kishor Patil said that the operating profit of the company improved due to a change in revenue mix and better productivity despite currency headwinds. Hence, they raised their margin outlook for the financial year.

KPIT Tech is also developing new sub-verticals like trucks and off-highways, which according to Joint Managing Director Sachin Tikekar, are “sizeable opportunities.”

“These will contribute to our growth from the second half of the next financial year,” Tikekar said, adding that there are new relationships being explored and built with the passenger car and truck makers in China and Rest of Europe beyond Germany.

Out of the 17 analysts that have coverage on KPIT Technologies, 12 of them have a ‘Buy’ rating, while three have a ‘Hold’ and two say ‘Sell’.

Shares of KPIT Tech are now trading 5.79% higher at ₹1,449.40.