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Informist, Tuesday, Jan. 27, 2026

 

By Shakshi Jain

 

MUMBAI – KPIT Technologies Ltd. is expected to report a marginal sequential growth in its consolidated top line for the December quarter, led by contributions from the recently-acquired gaming firm N-Dream AG and the engineering solutions business of Caresoft Global. The organic revenue of the company is expected to be flat or decline sequentially due to slow deal-to-revenue conversion and slower-than-expected ramp-up of deals, brokerages said. The technology company's sequential bottom line growth for the reporting quarter is expected to outpace the uptick in its top line, helped by substantially lower losses of its joint ventures, analysts said.

 

KPIT Technologies' top line for the December quarter is expected rise just over 2% sequentially and nearly 10% on year to INR 16.21 billion, according to the average of estimates from nine brokerages. The revenue estimates are in a tight range – the highest is INR 16.8 billion by Motilal Oswal Financial Services Ltd. and the lowest is INR 16.0 billion by Prabhudas Lilladher Pvt. Ltd.

 

The company's bottom line for the reporting quarter is expected to grow around 15% sequentially to INR 1.94 billion, as per the average of estimates. On a year-on-year basis, this would mean a slower growth of 3.6%. The highest net profit estimate for the December quarter is INR 2.13 billion by Dolat Capital Market Pvt. Ltd. and the lowest is INR 1.75 billion by ICICI Securities Ltd.

 

For the September quarter, KPIT Technologies had reported a consolidated net profit of INR 1.69 billion on revenues of INR 15.88 billion. In the year-ago quarter, the company's consolidated net profit was INR 1.87 billion and revenue was INR 14.78 billion.

 

KPIT Technologies provides engineering research and development services to companies in the automotive sector, which is currently navigating a slowdown globally.

 

"We forecast organic revenue decline of 0.5% qoq in c/c (constant currency) terms owing to continued demand uncertainty and slower-than-expected ramp-up of engagements," Kotak Securities Ltd. said, adding that weak demand in the Asia and Americas markets would drive the decline in revenue, primarily in the passenger vehicle segment. The brokerage expects an incremental revenue contribution of $2.5 million from the Caresoft business and an additional $1 million from N-Dream for the quarter under review.

 

Overall, analysts see the company reporting a 0.5-2.8% sequential growth in its constant currency revenue for the reporting quarter.

 

In dollar terms, the company is expected to report a revenue of $182.8 million for the December quarter, as per the average of estimates from eight brokerages.

 

Nirmal Bang Equities Pvt. Ltd. expects the company to report aggregate deal wins of more than $200 million for the December quarter, in line with the pace of the last seven consecutive quarters. Kotak Securities has a projection of $250 million to $300 million in total contract value for the December quarter.

 

The company's sequential bottom line growth is expected to outpace its top line growth for the reporting quarter due to lower losses of its joint ventures. The loss on the company's books related to its joint ventures for the December quarter is seen at INR 50 million by brokerage firm Prabhudas Lilladher against a loss of INR 227.16 million in the September quarter.

 

The company's earnings before interest and tax margin for the December quarter is expected to contract sequentially by 40 basis points to 16%, according to the average of estimates from seven brokerages. Broking firm Prabhudas Lilladher estimates a 50-bps impact on the company's EBIT margin from annual salary increments, which will be partially offset by the depreciation of the rupee against the dollar.

 

KPIT Technologies will announce its December quarter results Thursday. Investors await the management's commentary on conversion timelines for large engagements, the current demand scenario, recovery in the commercial vehicle and off-highway vertical, and the collaboration with JSW Motors wherein execution was expected to begin in the December quarter.

 

KPIT Technologies and JSW MG Motor India Pvt. Ltd. have formed a strategic partnership to build the software and digital backbone for a new energy vehicles portfolio.

 

"We expect the management to indicate more gradual improvement in demand, below normalised levels in the near-term," Kotak Securities said.

 

At 1422 IST, shares of KPIT Technologies were down almost 2% at INR 1,093.80 on the National Stock Exchange. The stock is down 8.3% since the company reported its results for the September quarter. It is down 26% from its 52-week high of INR 1,479, recorded on Jan. 30 last year.

 

Of the nine research recommendations on KPIT Technologies available with Informist, five have a 'buy' recommendation on the stock, one has a 'hold', and three have a 'sell' recommendation. The average target price of the 'buy' recommendations is INR 1,464 and that of the 'sell' calls is INR 1,082. This is almost 34% higher and around 1% lower than the current market price, respectively.

 

Following are the Oct-Dec earnings estimates for KPIT Technologies from nine brokerages in descending order of the estimate of net profit:

 

Broking firm	Revenue (INR bln)	Net Profit (INR bln)	Revenue ($ mln)	EBIT margin (%)
Dolat Capital Market Pvt Ltd	16.24	2.13	182	17
Motilal Oswal Financial Services Ltd	16.80	2.10	189	16.1
Elara Securities (India) Pvt Ltd	16.26	1.97	183
Kotak Securities Ltd	16.15	1.97	181	16.1
Prabhudas Lilladher Pvt Ltd	16.00	1.90	180.4	15.9
Nirmal Bang Equities Pvt Ltd	16.08	1.88	183	15.8
JM Financial Institutional Securities Pvt Ltd	16.12	1.87
HSBC Global Research	16.12	1.86	181	16.1
ICICI Securities Ltd	16.07	1.75	183	15
Average	16.21	1.94	182.8	16

 

End

 

US$1 = INR 91.70

 

Edited by Ashish Shirke

 

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