KPIT Technologies shares fall over 5% after it says business environment remains uncertain

Shares of the Pune-based automotive information technology company, KPIT Technologies, fell as much as 5.11% to hit an intraday low of ₹1,319.70 on the BSE in an otherwise strong market after it reported mid-quarter business update for the first quarter of current financial year. On the National Stock Exchange, KPIT Technologies shares fell as much as 5.10%.

KPIT Technologies in its mid-quarter business update said that its overall business environment continues to be uncertain with rising geopolitical concerns and ambiguity around the overall tariff scenario.

KPIT Technologies warned of slower pace of deal conversions going ahead.

"For KPIT, the pipeline continues to be strong, though the conversions are much slower than expected. Substantial pipeline however is moving in a positive direction. In geos, Europe is looking positive. USA /Asia are a bit uncertain. We have seen some early, small though important wins in trucks and off-highway," the company said.

KPIT Technologies added that project wins are progressing at an even slower space.

"The ramp-ups for the wins are progressing at an even slower pace than what was anticipated at the end of the last quarter. In some cases where new wins have happened, there is part cannibalization of our own revenues due to limited budgets available and spend happening in immediate priority areas," the Pune-based company said.

The company do not expect any one-time gains in first quarter of current fiscal.

Meanwhile, KPIT Technologies said that its acquisition of Caresoft’s Global Engineering Solutions Business, which was approved in May, is expected to be completed by end of this quarter and revenues of the acquired business will be consolidated beginning of second quarter.

The company reiterated that the acquisition will augment KPIT’s growth in trucks and off-highway segment, boost value creation for KPIT clients with full vehicle cost reduction solutions, enhance KPIT’s manufacturing engineering solutions portfolio and accelerate KPIT’s foray into China market.

As of 9:37 am, KPIT Technologies shares 4.33% lower at ₹1,330, underperforming the NIFTY Midcap 100 index which was up 0.73%.