Margins Expected to Decline in Q1
Additionally, the operating profitability (EBITDA Margin) and the Net Profit Margin for Q1FY27 would decline sequentially, proportionately higher than the revenue decline. This is because there is no window for cost optimisation during this short period.
Q2 Revenue Projected Same as Q1
In a separate filing on July 1, 2026, the company said that the revenue for the second quarter will also be in a similar range as the first quarter. This suggests another muted quarter before any meaningful recovery begins.
ER&D Slowdown Continues
The challenges facing KPIT are not company-specific. The broader Engineering Research and Development, or ER&D, industry has been slowing since FY25.
Spending on technology programmes has been moderated. Uncertainty around electric vehicles, hybrid vehicles and internal combustion engine platforms has delayed decision-making.
Second Half Expected to See Recovery
The company said demand continues to be healthy in its products and solutions business, the trucks and off-highway segment, and in markets such as the US, Korea and India. It also highlighted encouraging momentum from new customer additions in the passenger vehicle business.
Management said technology areas such as autonomous driving, connected mobility, after-sales software and full vehicle engineering continue to see healthy demand. The company is also investing in AI-led products while implementing productivity and cost-control initiatives.
The company expects business momentum to improve during the second half of FY27. Sequential growth may become visible by the fourth quarter. Management believes the increase will create a stronger base for FY28.
KPIT Technologies Ltd Share Price Performance
The stock on Friday opened marginally in the red. It opened at ₹547.05, which was lower compared to its previous close of ₹550.90. Later, the stock gathered buying interest and went on to make an intraday high of ₹587.00. This figure translates to a growth of 6.55% from the previous close.
However, the stock has shown weakness in the past. Especially on July 1, the stock fell over 16% as a result of the Q2 update. This event also led to the stock hitting its 52-week low on the same day.
This development has added to the weak performance over the last year and in 2026. It is down over 50% so far in 2026 and over 53% in the last year. The three-year performance of the stock also remains weak. It is down over 44% in the past three years.
About KPIT Technologies Ltd
KPIT Technologies Ltd is a global technology company focused on software solutions for the mobility industry. The company develops embedded software, AI and digital engineering solutions that support autonomous, connected, clean and smart mobility. It has a workforce of more than 12,000 employees and serves leading automobile manufacturers across the world.
