Mehabe score: 7 G Factor: 3 Piotski Score: 6 The stock has a rating OBSERVE & HOLD. The mehabe team score is reflective of its fundamental and technical merits. A rating above 8 is considered good buy. The stock has a G-Factor of 3 and Piotski score of 6.
Description
KPIT is a global technology company with software solutions that will help mobility leapfrog towards autonomous, clean, smart and connected future. With 6000+ Automobelievers across the globe, specializing in embedded software, AI & Digital solutions, KPIT enables customers accelerate implementation of next generation mobility technologies . With development centers in Europe, USA, Japan, China, Thailand and India
Main Points
Global Presence
The company has been earning about 41% of its revenues from USA, followed by Europe (39%) and Rest of World (20%). #
Germany has been the growth engine of company. It is the epicenter for the future technologies of mobility. The company has been investing heavily in Germany for last 3 years. Asia, led by Japan is another solid growth area for the company.Site:KPITTECHMain Symbol:KPITTECH
Stock trades at 295.0, above its 50dma 242.27. It also trades above its 200dma 179.74. The stock remains bullish on techicals
The 52 week high is at 298.45 and the 52week low is at 62.65
Price Chart
P/E Chart
Sales and Margin
Strengths
– has been maintaining a healthy dividend payout of 28.08%
-Debtor days have improved from 156.07 to 55.29 days.
Weakness
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Competition
– The industry trades at a mean P/E of 35.3x. Happiest Minds trades at the industry’s max P/E of 122.45x. KPITTECH trades at a P/E of 59.0x
– Industry’s mean G-Factor is 3.6 while the mean Piotski score is 9.0. KPITTECH has a G-Factor of 3 and Piotski scoreof 6.
– Average 1 month return for industry is 21.6%. The max 1- month return was given by Happiest Minds: a return of 43.43 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 567.0 cr compared to Rs 493.0 cr for period ended Jun 2020, a rise of 15.0%
Operating Profits reported at Rs 98.0 cr for period ended Jun 2021 vis-vis 64.0 for period ended Jun 2020 .
Operating Margins expanded 430.2 bps for period ended Jun 2021 vis-vis Jun 2020 .
The EPS for Jun 2021 was Rs 2.2 compared to Rs 1.91 for previous quarter ended Mar 2021 and Rs 0.88 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 2110.0 cr for period ended TTM vis-vis sales of Rs 2036.0 cr for the period ended Mar 2021, a growth of 3.5%. The 3 year sales cagr stood at 48.8%.
Operating margins expanded to 16.0% for period ended TTM vis-vis 15.0% for period ended Mar 2021, expansion of 100.0 bps.
Net Profit reported at Rs 182.0 cr for period ended TTM vis-vis sales of Rs 146.0 cr for the period ended Mar 2021, rising 19.8%.
Company recorded a healthy Net Profit CAGR of 49.9% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 628.0 cr for period ended Mar 2021 vis-vis Rs 389.0 cr for period ended Mar 2020
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The company has had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 12.0% compared to 14.0% over the last 3 Years. – The stock has given a return of 336% on a 1 Year basis vis-vis a return of % over the last 3 Years. – The compounded sales growth on a TTM bassis is -6% vis-vis a compounded sales growth of % over the last 3 Years. – The compounded profit growth on a TTM basis is -10% vis-vis a compounded profit growth of 698% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Jun 2021 fii holding stood at 19.82% vis-vis 20.92% for Mar 2021 – Public shareholding has risen for the period ended Jun 2021. The Jun 2021 public holding stood at 24.06% vis-vis 21.64% for Mar 2021
Conclusion
– has been maintaining a healthy dividend payout of 28.08%
-Debtor days have improved from 156.07 to 55.29 days. –
Fundamentally, the stock remains weak on business fundamentals. Weak near term results have dampened and questioned business drivers. We suggest to wait for a upturn in business performance.
Technically, the stock trades above its 50 DMA 242.27 and is trading at 295.0 It has shown near term bullish momentum contrary to business fundamentals. We suggest to observe price action. However as investors, who like to avoid timing the markets, we suggest to avoid the stock
