Whalesbook
Motilal Oswal's review of KPIT Technologies' fourth quarter for fiscal year 2026 highlighted mixed results. The company reported revenue growth of 1.8% in constant currency sequentially, reaching USD 185 million. This growth exceeded Motilal Oswal's forecast of 1% for the period.
The commercial vehicles segment was a key driver, posting a strong 11.6% quarter-on-quarter increase. In contrast, the passenger car segment saw a minor decline of 0.2% over the same period.
Operationally, KPIT maintained its efficiency. Earnings Before Interest and Taxes (EBIT) margins held steady at 15.9%, a 25 basis point improvement from the prior quarter and largely meeting analyst expectations. However, adjusted profit after tax experienced a significant contraction, decreasing by 9.6% quarter-on-quarter and 18.4% year-on-year to INR 1,630 million. This figure fell short of Motilal Oswal's estimate of INR 2,165 million.
KPIT's Strong ER&D Position
Despite the sequential dip in profitability, Motilal Oswal views KPIT Technologies as a leader in the automotive software and engineering, research, and development (ER&D) sector. The firm's specialized focus within this high-growth area continues to make it a preferred investment choice.
Analyst Reaffirms Buy Rating and Target Price
The brokerage reaffirmed its 'BUY' rating on the stock, setting a price target of ₹970 per share. This target is based on a multiple of 25 times estimated earnings per share for fiscal year 2028 (FY28E), reflecting confidence in KPIT's long-term growth prospects and market standing. Motilal Oswal believes KPIT is well-positioned to capitalize on industry shifts, such as the rise of electric and autonomous vehicles, and investors will be looking for sustained profit growth from its strong market position.