KPITTECH - Fundamental Analysis: Financial Health & Valuation
Last Updated Time : 20 Dec 25, 11:15 pm
Back to Fundamental ListFundamental Rating: 4.0
| Stock Code | KPITTECH | Market Cap | 33,565 Cr. | Current Price | 1,224 ₹ | High / Low | 1,536 ₹ |
| Stock P/E | 56.6 | Book Value | 71.2 ₹ | Dividend Yield | 0.73 % | ROCE | 34.4 % |
| ROE | 27.1 % | Face Value | 10.0 ₹ | DMA 50 | 1,206 ₹ | DMA 200 | 1,261 ₹ |
| Chg in FII Hold | -1.18 % | Chg in DII Hold | 1.53 % | PAT Qtr | 119 Cr. | PAT Prev Qtr | 229 Cr. |
| RSI | 39.6 | MACD | -4.78 | Volume | 4,56,222 | Avg Vol 1Wk | 7,03,571 |
| Low price | 1,021 ₹ | High price | 1,536 ₹ | PEG Ratio | 2.14 | Debt to equity | 0.07 |
| 52w Index | 39.5 % | Qtr Profit Var | -26.4 % | EPS | 21.6 ₹ | Industry PE | 26.4 |
📊 Financials Overview:
- Revenue & Profitability: Quarterly PAT declined from 229 Cr. to 119 Cr. (-26.4%), showing earnings pressure.
- Margins: ROE at 27.1% and ROCE at 34.4% indicate excellent efficiency and profitability.
- Debt: Debt-to-equity at 0.07 reflects a very low leverage position, ensuring financial stability.
- Cash Flow: Dividend yield at 0.73% provides modest shareholder returns.
💹 Valuation Indicators:
- P/E Ratio: 56.6 vs Industry PE of 26.4 → significantly overvalued.
- P/B Ratio: Current Price / Book Value ≈ 17.2 → trading at a steep premium.
- PEG Ratio: 2.14 → suggests growth is expensive relative to earnings.
- Intrinsic Value: Current price (₹1,224) is above fair zone; undervaluation closer to ₹1,050–₹1,100.
🏢 Business Model & Competitive Advantage:
- KPIT Technologies specializes in automotive software, focusing on electric vehicles, autonomous driving, and mobility solutions.
- Competitive advantage lies in niche expertise, global client base, and strong R&D investments.
- High efficiency metrics support long-term sustainability, though valuations remain stretched.
📈 Entry Zone & Holding Guidance:
- Entry Zone: Attractive near ₹1,050–₹1,100 (aligned with DMA 200 support).
- Long-Term Holding: Suitable for investors seeking exposure to EV and automotive software growth; accumulation at lower levels is preferable.
Positive
- Strong ROE (27.1%) and ROCE (34.4%) indicate excellent efficiency.
- Low debt-to-equity ratio (0.07) ensures financial stability.
- DII holdings increased (+1.53%), showing strong domestic investor confidence.
Limitation
- High P/E ratio (56.6) compared to industry average (26.4).
- P/B ratio at 17.2 indicates steep premium valuation.
- Quarterly PAT declined (-26.4%), showing earnings pressure.
Company Negative News
- FII holdings decreased (-1.18%), showing reduced foreign investor confidence.
- Stock trading below 52-week high (₹1,536 → ₹1,224), showing weak momentum.
Company Positive News
- DII holdings increased (+1.53%), reflecting strong domestic support.
- Strong efficiency metrics (ROE 27.1%, ROCE 34.4%) highlight operational strength.
Industry
- Industry PE at 26.4, much lower than KPIT’s valuation.
- Automotive software industry benefits from EV adoption, autonomous driving, and digital mobility trends.
Conclusion
⚖️ KPIT Technologies is a fundamentally strong player in automotive software with excellent efficiency and low debt. However, current valuations are stretched, and profitability has weakened. Investors may consider entry near ₹1,050–₹1,100 for better risk-reward. Long-term holding is viable for those confident in EV and automotive software growth, but monitoring earnings trends and valuation risks is essential.
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