KPIT Technologies

Subdued revenue performance, margin improvement a surprise, Buy

July 27, 2015

CAGR Growth (FY15-17E)

35.0%

29.2%

30.0%
25.0%
20.0%
20.0%

14.6%

15.0%
10.5%
10.0%

KPITs Q1FY16 performance was disappointing on revenue front. Revenue at

US$1118.4mn was down 3.3% QoQ, below our estimates of flat revenue
growth QoQ. Revenue miss was largely on account of substantial decline in
Products & Platform services due to the cyclical nature of ITS and other
software products revenue. EBITDA margin for the quarter improved 510bps
QoQ at 9.5% due to absence of one-time cost provision and tighter control on
lateral hiring. PAT declined 11.7% QoQ at `444mn, due to absence of tax
revision done in the last quarter. We maintain our rating to Buy with our
Price Target at `165, at 10xFY17E earnings (from `155 at 10xFY17E earnings).

5.0%
0.0%

Revenues

EBITDA

PBT

APAT

Stock Recommendation

Buy

CMP (`)

114

Price Target (`)

165

Upside (%)

47%

Earlier Call

Buy

52 Week H / L `

233/85

BSE 30

28112

Key Data
No. of Shares, Mn.

196.9

Mcap, ` Bn

22.4

Mcap,USD Bn @ `63

0.4

2 W Avg Qty (BSE+NSE) Mn

1.8

Share holding, Jun'15

Promoters

21.7

FII

29.2

DII

7.7

Public & Others

41.4

Performance

1M

3M

6M

12 M

Stock Return %

14.6

-21.6

-48.0

-28.2

Relative Return %

12.7

-24.2

-44.4

-37.0

50.0%
40.0%
30.0%
20.0%
10.0%
0.0%
-10.0%
-20.0%
-30.0%
-40.0%
-50.0%

IT Service revenue growth healthy 3.4%: During the quarter, IT services

registered strong growth of 3.4% QoQ on the back of robust growth in SAP and
Enterprise solutions. SAP, where KPIT faced some challenges in last quarter,
registered a growth of 17.0% QoQ. Products and Platform revenue declined 61%
QoQ due to cyclical nature of the ITS business and other software products
revenue.
EBITDA margin improvement better than estimates: EBITDA margin improved
510bps QoQ at 9.5% from 4.4% in last quarter, driven by employee pyramid
rationalization, more freshers inducted during the quarter and higher utilization.
Adjusting the one-off cost over-run in last quarter, margin improved 110bps
QoQ. Though the margin performance was better than estimates, we do not
expect KPIT to return to its normalized margin range of 14%-15% in near future
given the organization restructuring in the form of 1) delivery excellence, 2)
qualitative growth and 3) investments for future growth. For Q2, it will feel
margin pressure due to wage hike (~200bps) which will be partly off-set by
increase in fresher hiring and other operational efficiencies.
US grew 4.5% QoQ despite sluggish performance in Cummins account: US
reported strong growth of 4.5% QoQ after decline of 7.3% QoQ in last quarter.
Cummins, the largest customer, declined 8.2% QoQ. This is the third consecutive
decline in Cummins revenue on the back of 0.8% and 1.1% QoQ decline in Q4
and Q3 respectively.
Outlook and Valuation: Q1 performance for KPIT was below our estimates on
revenue front while 510bps QoQ improvement in margin came in as a surprise.
Out of the four focus areas of profitability improvement, people development,
predictability and growth, it delivered on profitability improvement in this
quarter while the rest three areas will take couple of quarter to show the result.
With the organization restructuring under way, we believe FY16 to be the year
of transition. We lower our FY16E/FY17E revenue forecast by 7.8%/5.7%
respectively while raise our EPS growth forecast by 7.0%/8.0% respectively. We
maintain our Buy rating with our Target Price at `165 implying 10xFY17E
earnings (earlier `155 on 10xFY17E earnings).

NIFTY

Shyamal Dhruve
shyamal.dhruve@sunidhi.com
Sunidhi Research |
Phone: +91-022-61131366

Jul-15

Jun-15

Jun-15

Apr-15

May-15

Apr-15

Mar-15

Jan-15

KPIT Technologies

Feb-15

Jan-15

Dec-14

Nov-14

Oct-14

Nov-14

Sep-14

Sep-14

Jul-14

Financials
Aug-14

Result update

IT services
Sector Outlook - Neutral

Revenues

EBIDTA Net Profit

EPS

P/E

EV/EBIDTA

ROE

FY13

` mn
22,386

` mn
3,650

` mn
2,095

`
11.3

x
10.1

x
5.8

%
19.4

FY14

26,940

4,233

2,391

13.7

8.3

5.3

18.7

FY15

29,899

3,271

2,385

12.7

9.0

6.7

18.4

FY16E

31,677

3,496

2,256

12.0

9.5

6.4

15.5

FY17E

36,527

4,710

3,132

16.6

6.8

4.4

17.91

Source: Company, Sunidhi Research

KPIT Technologies

Q1FY16 Result Review

Q1FY16 quarterly details
` mn

1Q16

4Q15

1Q15

QoQ

YoY Comments
Q1FY16 revenue at US$118.4mn was
down 3.3% QoQ. Cummins declined 8.2%
9.9
QoQ, while Top 10 Clients registered degrowth of 1.8%.
13.1
(12.8)
Operating margin improved 510bps QoQ
(249)bps mainly on account of absence of one-off
cost provision.
11.9
0.9

Revenues

7,583

7,630

6,897

(0.6)

- Operating costs
EBITDA

6,862
721

7,296
334

6,070
827

(5.9)
115.6

EBITDA margin (%)

9.5

4.4

12.0

512bps

- Interest expense
- Depreciation

47
164

140
225

42
162

(66.2)
(27.3)

+ Other income, net

(incl forex)

106

177

108

(40.0)

1.6

PBT
- Taxes
Effective tax rate (%)
PAT
- Minority interests
Consolidated PAT
Net margin (%)
EPS (`)

616
172
27.9
444
444
5.9
2.4

146
(357)
(244.9)
503
503
6.6
2.7

730
222
30.4
508
508
7.4
2.7

322.1
NA
NA
(11.7)
NA
(11.7)
(74)bps
(11.8)

(15.7)
(22.8)
(256)bps
(12.6)
NA
(12.6)
(151)bps
(13.5)

Source: Company, Sunidhi Research

Revenue above estimates:

KPIT reported USD revenue of $118.4mn, down 3.3% QoQ, below our estimates of flat
revenue compared to last quarter. IT services revenue registered strong growth of 3.4% QoQ
on the back of robust performance on SAP (+17.0% QoQ) and Enterprise solutions (+7.4%
QoQ) front. In INR terms, revenues came in at `7,583mn, down 0.6% QoQ, lower than our
estimates.
Revenue Trend
140

35

120

30
25

100

20

80

15

60

10
5

40

Revenue ($ mln)

1Q16

4Q15

3Q15

2Q15

1Q15

4Q14

3Q14

2Q14

1Q14

4Q13

3Q13

2Q13

1Q13

4Q12

-10

3Q12

2Q12

-5

1Q12

20

QoQ Growth (%)

Source: Company, Sunidhi Research

Sunidhi Research |

KPIT Technologies
Strong growth in US despite decline in Cummins account:
North America, which generates ~70% of revenues for KPIT, reported strong growth of 4.5%
QoQ despite sluggishness in Cummins account. Cummins declined 8.2% QoQ, third
consecutive decline for it. Management indicated Cummins account to have bottomed-out
and slight uptick in FY16. Europe declined 4.0% QoQ while APAC declined 29.5% QoQ mainly
due to decline in ITS revenue. Amongst industry segments, Automotive & Transportation
declined 13.0% QoQ while manufacturing grew 3.9% QoQ.
Margin performance better than estimates:
KPIT reported EBITDA margin increase of 510bps QoQ at 9.5%. The improvement in margin
was on account of employee pyramid rationalization and higher utilization. For Q2, it will have
~200bps headwinds to margins which will be partially off-set by more freshers hiring, higher
utilization and other operational efficiencies.
Margin Profile

16.1
14.2
12.0
9.6

13.9

13.3

11.1

10.1

9.5
7.3
4.4

EBITDA Margin (%)

1Q16

4Q15

3Q15

2Q15

1Q15

1.4

4Q14

20
18
16
14
12
10
8
6
4
2
0

EBIT Margin (%)

Source: Company, Sunidhi Research

Employee reduction due to pyramid rationalization:

To improve the profitability, it moved people internally to higher roles while controlling the
lateral hiring. This resulted in reduction of 141 employees on net basis. It also hired more
freshers (170 freshers) in the quarter. For Q2, managemnet plans to add 300+ employees.
Employee strength
Employees
Development team - Onsite (avg)
Development team - Offshore (avg)
Onsite FTE
Offshore FTE
Development (at qtr end)
General (end of qtr)
Marketing (end of qtr)
Total (at qtr end)
Onsite Utilization
Offshore Utilization

Q1FY14
1,176
6,553
1,107
4,809
7,771
545
140
8,456
94.2
73.4

Q2FY14
1,243
6,708
1,148
4,888
8,122
548
146
8,816
92.4
72.9

Q3FY14
1,274
6,987
1,123
4,985
8,430
554
152
9,136
88.1
71.3

Q4FY14
1,366
7,139
1,231
5,064
8,583
558
155
9,296
90.1
70.9

Q1FY15
1,423
7,224
1,293
5,068
8,757
568
165
9,490
90.8
70.2

Q2FY15
1,456
7,518
1,327
5,383
9,191
572
170
9,933
91.1
71.6

Q3FY15
1,494
7,868
1,348
5,519
9,541
575
175
10,291
90.2
70.2

Q4FY15
1,534
8,317
1,316
5,456
10,213
586
181
10,980
85.8
65.6

Q1FY16
1,564
8,514
1,362
5,654
10,062
585
192
10,839
87.1
66.4

Source: Company, Sunidhi Research

Sunidhi Research |

KPIT Technologies
Client addition moderate:
During the quarter, KPIT added 2 new clients, taking the total active client base to 210.
Client details
Client concentration
Clients Added
Total active clients
Customers with a run rate of $1mn+
Top customer - Cummins (%)
Top 5 Clients (%)
Top 10 Clients (%)

Q1FY14
6
189
78
16.8
38.6
47.3

Q2FY14
3
192
78
16.5
38.0
46.3

Q3FY14
3
195
78
17.9
38.2
47.6

Q4FY14
3
198
80
15.5
35.7
45.8

Q1FY15
3
201
83
15.9
34.4
45.1

Q2FY15
2
203
84
14.9
32.1
42.8

Q3FY15
3
206
87
14.6
28.6
39.4

Q4FY15
2
208
90
14.9
30.1
41.6

Q1FY16
2
210
87
14.2
30.7
42.2

Source: Company, Sunidhi Research

SBU Performance Highlights:

A) Integrated Enterprise Solutions down 2.5% QoQ, down 0.9% YoY
Seen significant success in winning new cloud deals and are building new solutions on
cloud platform
Investing in strategic platforms, technologies and solution offerings like IoT, Social ERP,
P2P automation etc
Intend to leverage its niche position in Product Lifecycle Management (PLM) by
integrating strategic consulting, extended PLM and Product engineering service
offerings
During the year, digital revenues in IES were ~5% of the total IES revenue
B) Product Engineering Services up 1.8% QoQ, up 21.8% YoY
See healthy traction in its solutions in Advanced Driver Assistance Systems (ADAS) and
also witnessing pull in areas such as diagnostics, lane departure features as well as V2XV2V communication mainly from Indian customers
Focused on investment in incubation of new practice offerings and new practices and
have initiated a new practice on Mechatronics, sensor optimization and IVHM
C) SAP up 17.0% QoQ, down 4.5% YoY
Started work on a few deals, which were delayed during Q4FY15. With growing
significance of cloud based technologies like SuccessFactors, CEC, Hybris, CPQ and
other emerging technologies like HANA, Hadoop and IoT, also transforming its business
mix from traditional ERP to these innovative solutions.
There is good growth momentum in the US geography. Continued winning deals in
CRM, BI, SuccessFactors, S4/ HANA, Simple Finance, SAP Hybris and CPQ during the
quarter.
With significant increase in M&A activity mainly in manufacturing sub-verticals, have
been building solutions and accelerators designed for this industry, which have been
adding value to our customers. Also working with other companies in various
complementary technology areas such as Hybris/ CEC.
During the year, digital revenues in SAP were ~22% of the total SAP revenue
D) Enterprise Solutions up 7.4% QoQ, down 5.6% YoY
There is an increase in demand for CRM solution implementations, Support and version
upgrade. It is also witnessing increased adoption of Microsoft solutions by existing
customers in Collaboration area - content and portal, integration and cloud. The
traction is primarily growing in US and Canada region.
Continue to invest further in building solutions addressing Legacy Modernization needs
of customer - e.g. Lotus Notes Applications migration to Microsoft SharePoint platform.
We are also building Business Process Library covering key business areas (O2C, P2P &
Customer Service) using BPMN compliant tools like ARIS and Provision.
During the year, digital revenues in ES were ~5% of the total ES revenue
Sunidhi Research |

KPIT Technologies
Geographical wise Performance
Geographical mix (%)

Q3FY14

Q4FY14

Q1FY15

Q2FY15

Q3FY15

Q4FY15

Q1FY16

QoQ (%)

YoY (%)

US

72.6

69.8

69.1

66.5

67.3

64.5

69.7

4.5

3.5

Europe

15.4

14.5

15.8

13.7

15.5

16.9

16.7

(4.0)

8.7

RoW

12.0

15.8

15.1

19.8

17.2

18.6

13.6

(29.5)

(7.4)

Total

100.0

100.0

100.0

100.0

100.0

100.0

100.0

(3.3)

2.7dd

Source: Company, Sunidhi Research

Revenue split by Vertical

Revenue spread (%)
Automotive &
Transportation
Manufacturing
Energy & Utilities
Others
Total

Q3FY14

Q4FY14

Q1FY15

Q2FY15

Q3FY15

Q4FY15

Q1FY16

QoQ (%)

YoY (%)

36.4
38.9
15.1
9.7
100.0

33.1
39.2
18.0
9.7
100.0

32.7
40.9
17.8
8.6
100.0

37.1
31.6
21.7
9.6
100.0

36.0
32.8
21.8
9.5
100.0

41.3
33.3
17.8
7.7
100.0

37.1
35.8
18.7
8.4
100.0

(13.0)
3.9
1.7
6.3
(3.3)

16.7
(10.3)
8.0
0.3
2.7

Q3FY14
39.2
25.1
0.0
23.8
11.9
100.0

Q4FY14
39.2
25.9
0.0
23.7
11.2
100.0

Q1FY15
40.4
21.9
4.4
22.6
10.7
100.0

Q2FY15
38.0
30.0
0.0
22.6
9.4
100.0

Q3FY15
38.7
29.1
0.0
23.3
8.9
100.0

Q4FY15 Q1FY16
38.7
39.0
24.7
26.0
10.5
4.2
17.4
21.0
8.8
9.8
100.0
100.0

QoQ (%)
(2.5)
1.8
(60.9)
17.0
7.4
(3.3)

YoY (%)
(0.9)
21.8
(2.4)
(4.5)
(5.6)
2.7

Source: Company, Sunidhi Research

Revenue split by SBU

Revenue spread (%)
Integrated Enterprise Solutions
Product Engineering Services
Products & Platforms
SAP
Enterprise Solutions
Total
Source: Company, Sunidhi Research

Revenue and Contract Type Split

Onsite/Offshore Split (%)
Onsite Revenue
Offshore Revenue
SI
Revenue by Contract Type (%)
Time and Material Basis
Fixed Price / Time Basis
SI
Total

Q1FY14

Q2FY14

Q3FY14

Q4FY14

Q1FY15

Q2FY15

Q3FY15

Q4FY15

Q1FY16

54.2
45.8
100.0

54.6
45.4
100.0

52.8
47.2
100.0

54.3
45.7
100.0

57.2
41.6
1.3
100.0

51.1
43.7
5.3
100.0

53.5
43.2
3.3
100.0

52.4
42.6
5.0
100.0

55.3
437
1.0
100.0

76.9
23.2
100.0

76.4
23.6
100.0

75.6
24.4
100.0

72.9
27.1
100.0

71.6
27.1
1.3
100.0

65.1
29.6
5.3
100.0

62.9
33.8
3.3
100.0

63.7
31.3
5.0
100.0

72.9
26.2
1.0
100.0

Source: Company, Sunidhi Research

Outlook and Valuation:

After the muted performance in last quarter, KPIT delivered strong margin performance
during the quarter while miss on revenue can be attributed to the organization restructuring.
Out of the four focus areas of profitability improvement, people development, predictability
and growth, it delivered on profitability improvement in this quarter while the rest three
areas will take couple of quarter to show the result. With the organization restructuring under
way, we believe FY16 to be the year of transition. We lower our FY16E/FY17E revenue
forecast by 7.8%/5.7% respectively while raise our EPS growth forecast by 7.0%/12.8%
respectively. Currently, stock is trading at 9.5xFY16E and 6.8xFY17E earnings. We maintain our
Buy rating with our Target Price at `165 implying 10xFY17E earnings (earlier `155 on
10xFY17E earnings).
Sunidhi Research |

KPIT Technologies
Change in Estimates
FY16E
New
501
31,677
11.0
12.0
63.3

Old
543
33,936
10.3
11.2
62.5

Revenue (US$ mn)

Revenue (` mn)
EBITDA margin (%)
EPS (`)
`/Dollar Rate

%Chg
(7.8)
(6.7)
69bps
7.0
--

Old
615
38,432
11.9
15.4
62.5

FY17E
New
580
36,527
12.8
16.6
63.0

%Chg
(5.7)
(5.0)
95bps
8.0
--

Source: Company, Sunidhi Research

1 Year Forward PE
350
300
250
200
150
100
50

Price

5X

9X

13 X

17 X

Apr/15

Oct/14

Apr/14

Oct/13

Apr/13

Oct/12

Apr/12

Oct/11

Apr/11

Oct/10

Apr/10

Oct/09

Apr/09

Oct/08

Apr/08

Oct/07

Apr/07

Oct/06

Apr/06

Oct/05

Apr/05

21 X

Source: Company, Sunidhi Research

Peer Comparison
Company
CMP

Rating Target Upside

(`)
(%)

Adj EPS (`)

P/E (x)

USD Rev Growth

(%)
FY15 FY16E FY17E FY15 FY16E FY17E FY15 FY16E FY17E

RoAE (%)
FY15

FY16E

FY17E

MindTree

1269

Accumulate

1395

9.9

64.1

70.7

87.1

19.8

17.9

14.6

16.4

17.8

16.0

29.4

27.0

27.6

KPIT Tech

113

Buy

165

45.5

12.7

12.0

16.6

9.0

9.5

6.8

10.0

2.4

15.8

18.4

15.5

17.9

Hexaware

274

Sell

230

-16.1

10.7

13.4

15.8

25.7

20.5

17.4

8.9

14.8

16.5

25.7

29.5

31.2

NIIT Tech

480

Hold

465

-3.1

18.7

42.5

46.3

25.6

11.3

10.4

1.1

9.1

10.2

8.5

17.8

17.2

Source: Company, Sunidhi Research

Sunidhi Research |

KPIT Technologies
Valuations Summary

Balance Sheet (` mn)

Year End-March

FY13

Per share (`)

EPS
CEPS
BVPS
DPS
Payout (%)
Valuation (x)
P/E
P/BV
EV/EBITDA
Dividend Yield (%)
Return ratio (%)
EBIDTA Margin
PAT Margin
ROAE
ROACE
Leverage Ratios (x)
Long Term D/E
Net Debt/Equity
Debt/EBITDA
Interest Coverage
Current ratio
Growth Ratios (%)
Income growth
EBITDA growth
PAT growth
Turnover Ratios
F.A Turnover x

FY14

FY15

FY16E

FY17E

Year End-March
Equity Share Capital
Reserves & Surplus
Total Shareholders Fund
Minority Interest
Non- current liabilities
Long Term Borrowings
Deferred Tax Liabilities
Other LT Liabilities & Prov
Current Liabilities
Short Term Borrowings
Trade Payables
Other Cur Liabilities & Prov
Total Liabilities
Assets
Non- Current Assets
Fixed Assets
Goodwill
Non-Current Investments
Long-Term Loans & Adv
Other Non-Current Assets
Current Assets
Current Investments
Trade Receivables
Inventories
Cash & Bank Balances
Short-Term Loans & Adv
Other Current Assets
Total Assets

11.3
13.9
58.1
0.9
9.4

13.7
15.8
68.7
1.1
10.0

12.7
17.2
68.9
1.1
10.1

12.0
16.5
83.5
1.1
10.7

16.6
22.1
98.7
1.3
9.1

10.1
2.0
5.8
0.8

8.3
1.6
5.3
1.0

9.0
1.6
6.7
1.0

9.5
1.4
6.4
1.0

6.8
1.1
4.4
1.1

16.3
9.4
19.4
21.8

15.7
8.9
18.7
21.1

10.9
8.0
18.4
15.9

11.0
7.1
15.5
17.1

12.9
8.6
17.9
20.4

0.1
(0.2)
0.4
19.6
1.8

0.1
(0.2)
0.3
12.6
1.7

0.1
(0.2)
0.4
10.2
1.7

0.0
(0.2)
0.0
18.2
1.7

0.0
(0.3)
0.0
27.6
1.9

49.2
67.4
52.4

20.3
16.0
19.1

11.0
(22.7)
(0.3)

5.9
6.9
(5.4)

15.3
34.7
38.8

11

12

13

12

15

Debtors Days

73

77

84

89

91

Year End-March

Payable days

29

18

16

16

15

PBT
Depreciation

FY13
22,386
18,736
3,650
(170)
466
3,014
154
2,860
766
2,095
(86)
5
2,014

FY14
26,940
22,708
4,233
(74)
540
3,619
287
3,332
941
2,391
2,391

FY15
29,899
26,628
3,271
352
851
2,771
272
2,500
115
2,385
2,385

FY16E
31,677
18,307
3,496
433
722
3,208
177
3,031
775
2,256
2,256

FY17E
36,527
27,065
4,710
508
885
4,333
157
4,176
1,044
3,132
3,132

Inventory Days

Income Statement (` mn)

Year End-March
Revenues
Op. Expenses
EBITDA
Other Income
Depreciation
EBIT
Interest
PBT
Tax
PAT
Minority
Sh. of Associates
Ex. ordinary
Adj Pat

Source: Company, Sunidhi Research

Sunidhi Research |

FY13
386
9,977
10,362
270
1,533
1,459
(69)
143
5,597
1,753
1,199
2,645
17,763

FY14
371
12,380
12,751
1,244
1,301
(289)
233
6,949
3,089
1,021
2,839
20,945

FY15
376
12,585
12,961
1,271
1,368
(520)
423
7,948
3,089
1,308
3,551
22,181

FY16E
376
14,719
15,095
1,127
623
504
8,182
3,089
1,185
3,908
24,405

FY17E
376
17,564
17,941
790
223
572
8,868
3,089
1,344
4,434
27,603

7,721
2,005
4,423
118
1,138
37
10,042
2,036
4,673
1,921
593
818
17,763

9,048
2,161
5,994
118
672
103
11,897
1,741
6,743
34
1,908
744
727
20,945

8,925
2,328
5,088
118
1,266
125
13,256
698
6,979
229
3,638
681
1,032
22,181

10,459
2,572
5,293
118
2,476
13,946
522
8,427
436
3,130
1,431
24,405

10,759
2,487
5,293
118
2,861
16,845
522
9,737
503
4,430
1,653
27,603

FY13
2,860

FY14
3,332

FY15
2,500

FY16E
3,031

FY17E
4,176

466

540

850

722

885

154

287

272

177

157

(86)
3,394
1,240
2,154
766
1,388
618
(801)
(1,572)
(2,991)
1,074
30
(154)
(188)

4,158
1,657
2,501
941
1,560
696
(1,571)
295
(1,971)
1,177
(15)
(287)
(239)

3,623
100
3,523
115
3,408
1019
906
1,044
931
67
5
(272)
(242)

3,929
2,143
1,787
775
1,011
966
(206)
176
(995)
(744)
0
(177)
(242)

5,218
1,231
3,987
1,044
2,943
800
(800)
(400)
(157)
(286)

1,294
2,051
448
1,473
1,921

(239)
398
(13)
1,921
1,908

(1,846)
(2,610)
1,730
1,908
3,638

640
(523)
(507)
3,638
3,130

(0)
(843)
1,300
3,130
4,430

Cash flow Statement

Interest Exp
Others
CF before W.cap
Inc/dec in W.cap
Op CF after W.cap
Less Taxes
Net CF From Operations
Inc/(dec) in F.A + CWIP
(Inc)/Dec in Goodwill
(Pur)/sale of Investments
CF from Invst Activities
Loan Raised/(repaid)
Equity Raised
Interest Payment
Dividend
Others
CF from Fin Activities
Net inc /(dec) in cash
Op. bal of cash
Cl. balance of cash

KPIT Technologies
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KPIT Technologies

Sunidhis Rating Rationale

The price target for a large cap stock represents the value the analyst expects the stock to reach over next 12 months. For a stock to be
classified as Outperform, the expected return must exceed the local risk free return by at least 5% over the next 12 months. For a stock to
be classified as Underperform, the stock return must be below the local risk free return by at least 5% over the next 12 months. Stocks
between these bands are classified as Neutral.
(For Mid & Small cap stocks from 12 months perspective)
BUY

Absolute Return >20%

ACCUMULATE

Absolute Return Between 10-20%

HOLD

Absolute Return Between 0-10%

REDUCE

Absolute Return 0 To Negative 10%

SELL

Absolute Return > Negative 10%

Apart from Absolute returns our rating for a stock would also include subjective factors like macro environment, outlook of the industry
in which the company is operating, growth expectations from the company vis a vis its peers, scope for P/E re-rating/de-rating for the
broader market and the company in specific.

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