KPIT Tech shares jump 11% in 2 sessions to record high as company raises FY24 guidance

For the financial year FY24, the company now expects revenue growth of 37 percent in CC terms, from the earlier guidance which ranged between 27 and 30 percent. It has also upped its operating profit or EBITDA (earnings before interest, taxes, depreciation, and amortisation) guidance for the year to over 20 percent from 19-20 percent earlier.

Just in today’s deals, it rose as much as 5.8 percent to its new high of ₹1,253.90 apiece. It advanced 5 percent in the previous session. It has now surged 101 percent from its 52-week low of ₹623.00, hit on December 23, 2022.

The stock has rallied over 64 percent in the last 1 year and 78 percent in 2023 YTD.

The sentiment was also positive as the firm posted strong results and met Street expectations in its September quarter earnings.

The company posted a 69.21 percent year-on-year (YoY) jump in the net profit to ₹141.40 crore for the second quarter ended September 30. Sequentially, its profit was up 5 percent.

Its revenue rose over 60 percent YoY and 8 percent QoQ to ₹1,208.86 crore in the quarter under review. In comparison, it reported a revenue of ₹745 crore in the year-ago period and ₹1,098 crore in the preceding April-June quarter. Its dollar revenue increased 54.3 percent YoY and 8.4 percent QoQ.

EBITDA margin for Q2 came in at 20 percent after absorbing the impact of wage hikes during the quarter. The gross impact of wage hikes was 250 bps which was offset by revenue growth and net realisation improvement, informed the firm.

However, the company’s order book for the period stood at $156 million for the quarter, down from $190 million reported in Q1.

This robust growth comes at a time when the IT services sector is seeing muted growth amidst macroeconomic uncertainties.

Kishor Patil, co-founder, CEO and MD, KPIT, said, “We are delighted to deliver another quarter, consistent with our robust performance over the last 3 years. Our medium-term business fundamentals and growth drivers remain unchanged. While the geopolitical situation and economic uncertainty across geographies is leading to a softer macro environment, we keep a watchful eye on the impact on our clients and their business priorities.”

“Our clients remain committed to making investments in newer, relevant technologies. Basis our performance so far and near-term visibility, we raise our CC revenue growth outlook for FY24 to over 37 percent growth and increase EBITDA margin outlook to over 20 percent,” Patil added.

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Updated: 31 Oct 2023, 11:19 AM IST