KPIT Technologies Limited

Technology — Software - Application · NSE

₹555.00+₹29.00 (+5.51%)

DalalBaazaar Score

66 / 100

🟢 Good

Verdict

REASONABLE

Risk

Low

Driven by small-cap size, which brings sharper price swings, falling profits.

In simple words: Strong business and financial position, though profits are falling even as sales grow. The direction of profits is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:08 pm

Mixed / neutral. No major red flags jump out, but nothing here screams "obviously cheap" either. This is a name that needs a peer comparison and a view on near-term earnings triggers before sizing a position.

Understanding the Business

Company site ↗

The 60-second version of KPIT Technologies Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

KPIT Technologies Limited provides embedded software, artificial intelligence, and digital solutions for the automobile and mobility sector in the Americas, the United Kingdom, rest of Europe, and internationally.

IndustrySoftware - Application

SectorTechnology

Employees12,520

Annual revenue₹6,455 Cr

How does it make money?

Turns over ₹6,455 Cr a year. Of every ₹100 of sales, about ₹10 reaches shareholders as profit, with ₹19 left at the operating level before interest, tax and depreciation. Each of its 12,520 employees supports ₹51.6 lakh of revenue a year, the signature of a people-led business.

EBITDA margin19.4%

Net margin9.9%

Revenue / employee₹51.6 lakh

Who are its competitors?

The closest listed comparisons in its industry are TATA CONSULTANCY SERV LT, INFOSYS LIMITED, HCL TECHNOLOGIES LTD, WIPRO LTD. These are the companies its valuation and returns are measured against elsewhere in this report.

TATA CONSULTANCY SERV LTP/E 17.3x · ROE 45.6%

INFOSYS LIMITEDP/E 15.8x · ROE 32.0%

HCL TECHNOLOGIES LTDP/E 20.4x · ROE 24.6%

WIPRO LTDP/E 14.5x · ROE 15.9%

What is its competitive advantage?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 21.3%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 18.0% against a peer median of 32.0% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

ROCE21.3%

ROE18.0%

Peer median ROE32.0%

What is the outlook?

18 analysts covering the stock expect revenue to grow about 9.8% and earnings to grow about 40.3% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+9.8%

Est. earnings growth+40.3%

Analysts18

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +92% while net margin moved -13% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+92%

Margin effect-13%

DalalBaazaar Score

66/ 100

Good

Weighted across six categories. Every point is explained below.

✓ ROE of 18.0% clears the 15% mark
✗ ROE has fallen by 5.1 points over the period

Quality vs. Valuation

Company Quality

67/ 100

Good

How good the business is, ignoring the share price entirely.

Valuation

59/ 100

Fair

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

26.1x

3Y Median

60.1x

40 monthly readings · mean 62.1x · range 19.5x–132.1x

Sector Median

16.5x

median of 4 sector peers

🟢Current valuation is approximately 57% below its 3y median of 60.1x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

⚠️Against its sector it trades 58% above the peer median of 16.5x.

vs. its own history

Cheap

60.1x median over 40 months · -57%

vs. sector peers

Expensive

16.5x median of 4 peers · +58%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

26.1x

P/B

4.27x

EV/EBITDA

11.7x

PEG

1.39

Dividend Yield

1.35%

What's Good / What's Bad

🟢 What's Going Well5

Cash generation is improving
Free cash flow is up 216% over 3 years.
High return on capital employed
ROCE of 21.3% is the mark of a business that converts capital into profit efficiently.
Valuation below its historical average
At 26.1x the stock trades 57% below its own median of 60.1x.
Very low debt
Debt/Equity of 0.24x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention3

Debt is rising
Total debt is up 193% over 3 years — worth checking what it funded.
Return on equity is falling
ROE has dropped from 23.1% to 18.0% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 23.7% to 21.3% — often a sign of competition or overexpansion.

Red Flags

1 item require attention · 1 high

🔴Debt has risen sharplyFinancial
Total debt is up 193% over 3 years, from ₹287 Cr to ₹838 Cr.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 21.3% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Priced below its own history
The stock trades 57% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹1,052 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

A premium to the sector to defend
It trades 58% above the peer median. That premium needs a reason that persists, or it closes.
Returns on shareholder capital are falling
ROE has dropped from 23.1% to 18.0%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
Size brings its own risk
Small Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 18% a year✓ 24.3% CAGR
Latest reported year was 8.9%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 17%✓ 19.4%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✓ ₹1,052 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.7x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 18%✓ 21.3%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

9 / 12 checks passed

✓ Strong return on equity (ROE ≥ 15%)
✓ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✗ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

5 good · 5 neutral · 1 weak

Market Cap

₹15,109 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

26.1x

Fair

Fairly valued against the generic band

P/B Ratio

4.27x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹21.28

Profitable

Profitable on a per-share basis

ROE

18.0%

Strong

Strong capital efficiency

ROCE

21.3%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.24x

Low

Conservative leverage

Revenue Growth (YoY)

8.9%

Modest

Modest growth

Profit Growth (YoY)

-31.8%

Falling

Profits are shrinking

Dividend Yield

1.35%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

₹1,052 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹555

P/E (Forward)

17.9x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

12.3%

Average

Average margins

Net Margin

8.8%

Average

Average bottom-line conversion

Current Ratio

1.03

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

0.01

Defensive

Steadier than the market

52W Range Position

10%

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

509.8 / 557.4

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

61.1

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹3,365 Cr	₹4,872 Cr	₹5,842 Cr	₹6,455 Cr	+24.3%
EBITDA	₹682 Cr	₹1,055 Cr	₹1,288 Cr	₹1,252 Cr	+22.4%
EBITDA Margin	20.3%	21.7%	22.1%	19.4%	—
PAT (Net Profit)	₹381 Cr	₹595 Cr	₹840 Cr	₹637 Cr	+18.7%
EPS	₹13.95	₹21.77	₹30.7	₹23.28	+18.6%
ROE	23.1%	27.7%	28.8%	18.0%	—
ROCE	23.7%	32.2%	35.5%	21.3%	—
Total Debt	₹287 Cr	₹329 Cr	₹345 Cr	₹838 Cr	+43.0%
Free Cash Flow	₹333 Cr	₹846 Cr	₹1,260 Cr	₹1,052 Cr	+46.7%

🟢 Revenue has grown at 24.3% a year over 3 years.

🟢 EBITDA has grown at 22.4% a year over 3 years.

🟡 EBITDA Margin has held roughly flat at 19.4% over 3 years.

🟢 PAT (Net Profit) has grown at 18.7% a year over 3 years.

🟢 EPS has grown at 18.6% a year over 3 years.

🔴 ROE has fallen from 23.1% to 18.0% over 3 years (-5.1 pts).

🔴 ROCE has fallen from 23.7% to 21.3% over 3 years (-2.4 pts).

🔴 Total Debt has grown at 43.0% a year over 3 years.

🟢 Free Cash Flow has grown at 46.7% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹7,256 Cr

Total Liabilities

₹3,708 Cr

Total Debt

₹838 Cr

Cash & Equivalents

₹1,314 Cr

Operating Cash Flow

₹1,195 Cr

Capex

-₹143 Cr

Shareholding (proxy)

Institutional Holding

28.6%

Insider Holding

44.3%

Corporate Actions

Next Earnings

09 Nov 2026

Dividend Rate

₹7.5

Ex-Dividend Date

12 Aug 2026

Analyst Consensus

Recommendations

9 Buy · 5 Hold · 7 Sell

Target Price (Mean)

₹624.24

+12.5% vs CMP

Target Range

₹460 – ₹870

Peer Comparison

Company	P/E	ROE
TATA CONSULTANCY SERV LT	17.3x	45.6%
INFOSYS LIMITED	15.8x	32.0%
HCL TECHNOLOGIES LTD	20.4x	24.6%
WIPRO LTD	14.5x	15.9%

Recent News

2 mixed1 negative3 general

Broader markets underperform; Tata Elxsi, KPIT Technologies, Suzlon Energy lead midcap gainers

Moneycontrol.com, 18 OctAnalyst view

🔴Potentially negativeAn analyst opinion changing, which moves the price without changing the business.

KPIT Technologies Share Price analysis after strong move

Univest, 13 Oct

KPIT Technologies - 10 midcap stocks that have fallen up to 58% from their 52-week highs

The Economic Times, 24 Sept

Compare with

Equitymaster, 17 Oct

KPIT Technologies stock plunges 8% post Q1 FY27 earnings; Goldman Sachs and other analysts share insights

Upstox, 29 JulAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

KPIT Technologies Shares Plunge 15% After Weak Outlook and Block Deals, Hit Lower Circuit

HDFC Sky, 01 JulPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

🟢Business QualityStrong14.1/20

🟢Financial HealthStrong14.6/20

🟡GrowthModest12.9/20

🟡ProfitabilityModerate8.4/15

🟡ValuationFair9.5/15

🟡RiskModerate6/10

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself. 1 high-severity red flag sits above this conclusion and should be read first.

This thesis breaks if

✓Revenue growth stays above 18% a year24.3% CAGR
✓EBITDA margin holds above 17%19.4%
✓Free cash flow remains positive₹1,052 Cr
✓Debt / EBITDA stays below 2x0.7x
✓ROCE stays above 18%21.3%