KPIT Technologi. (KPITTECH)

FairStock Score: 46/100 — MIXED

Score breakdown: P/E: 1/3 · ROCE: 2/2 · Growth: 0/2 · Dividend: 0/1

Key Financials

Strengths

• High return ratios: ROE 24.69% and ROCE 40.03%
• Low financial leverage: Debt/Equity 0.16 with strong FCF of ₹762 Cr
• Long-term revenue record: 5-year CAGR 23.47% and latest sales up 11.37%
• Strong solvency metrics: Altman Z-score 5.21 and Piotroski F-score 7/9
• Promoter holding of 39.41% aligns with minority investors

Concerns

• Price far above intrinsic estimates: Graham Number ₹250.39 and DCF value ₹172 imply negative margin of safety
• Profit growth declined -5.30% even as revenue growth slowed; momentum is fading
• Expensive valuation: P/E 27.78 and P/B 6.90 leave little room for error
• Dividend yield is only 1.10%, so returns depend entirely on future price appreciation

AI Analysis

When I look at KPIT, I see a business that has been run well. An ROE of 24.69% and ROCE of 40.03% are excellent; debt-equity of 0.16 means the balance sheet is not the worry. Free cash flow of ₹762 Cr is strong and tells me earnings are being converted into cash, not just accounting paper. Promoters too own 39.41%, so their interests are with mine. But Graham’s safety-margin principle stops me here. At ₹733.40, P/E is 27.78 and P/B is 6.90. The Graham Number is ₹250.39 and DCF value is ₹172; that is a deeply negative margin of safety. Meanwhile, revenue growth has slowed to 11.37% from a five-year CAGR of 23.47%, and profit growth is negative at -5.30%. The latest quarter's net profit of ₹133 Cr on revenue of ₹1,617 Cr shows a business still making money, but not accelerating. FairStock gives it a STEADY score of 64, which matches my view: good franchise, average moment for growth. The 52-week range of ₹543.40 to ₹1,328 shows how quickly Mr Market can change his mood. From the current price, I need profits to resume growing at a fast pace just to make the multiple reasonable. I would rather wait for either a lower price or proof of resumed growth. I will keep it on my watchlist, but I will not buy blind optimism. In Buffett's words, be fearful when others are greedy; today I feel cautious, not greedy.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer