Q3 Earnings Impact: KPIT Tech shares surge 8% after company raises FY25 guidance

Shares of KPIT Technologies rallied 8 percent in intra-day deals on Thursday, January 30 after the company posted strong results for the quarter ended December 2024 (Q3FY25) and raised its EBIT margin guidance for financial year 2025.

KPIT Technologies has revised its EBITDA margin guidance upward to over 21 percent from its previous estimate of over 20.5 percent. The company, however, has maintained its constant currency revenue growth outlook in the range of 18 to 22 percent.

Financial Performance

For the December 2024 quarter, KPIT Technologies reported a 19.27 percent year-on-year increase in net profit, reaching ₹186.97 crore compared to ₹156.75 crore in the same quarter last year. Revenue from operations also saw a 17.6 percent growth, rising to ₹1,477.96 crore from ₹1,256.96 crore in the corresponding period of the previous fiscal.

On a sequential basis, KPIT Technologies’ net profit declined by over 8 percent from ₹203.75 crore in the preceding quarter. Revenue from operations during the December 2024 quarter also dipped 1.3 percent compared to ₹1,523.31 crore reported in the September 2024 quarter.

The company’s EBITDA margin for Q3FY25 stood at 21.1 percent, up from 20.8 percent in the previous quarter. KPIT Technologies attributed this improvement to productivity gains, a favorable revenue mix, and better fixed-cost leverage.

KPIT Technologies also said that $236 million worth engagements were closed in the quarter under review.

Co-founder, MD & CEO Kishor Patil stated that the company's operating profit improved due to a favorable shift in revenue mix and enhanced productivity, despite challenges from currency fluctuations. As a result, KPIT Technologies has raised its margin outlook for the financial year.

Additionally, the company is expanding into new sub-verticals such as trucks and off-highway vehicles, which Joint Managing Director Sachin Tikekar described as "sizeable opportunities." He noted that these segments are expected to contribute to growth starting from the second half of the next financial year. Tikekar also highlighted that KPIT Tech is actively exploring and establishing new partnerships with passenger car and truck manufacturers in China and across Europe, beyond its existing presence in Germany.

Stock Price Trend

The stock rose as much as 8 percent to its day's high of ₹1479.00.

The scrip is now over 23 percent away from its peak of ₹1,928.75, hit in July 2024, meanwhile, it has advanced 21 percent from its 52-week low of ₹1,223.75, recorded in the previous session, January 29. The stock ended 9 percent higher in yesterday's trade.

In the last 1 year, the stock has lost 6 percent whereas in January so far it is down 1 percent.