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KPIT Issues Q1 Profit Warning and Shares Plunge to 52‑Week Low

The Pune-based automotive software firm said sudden spending cuts by several European automakers drove a roughly 1% dollar revenue decline and warned margins would fall, signaling a weak H1 but a hoped-for recovery in H2.

In its clarification, KPIT said, "We expect Q2 FY27 revenue to be in the similar range as Q1 FY27 revenue."
JPMorgan downgraded KPIT Technologies to 'Underweight' from its earlier rating and slashed the target price to Rs 550 from Rs 700.
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Overview

  • KPIT told stock exchanges that it expects reported Q1 FY27 revenue in US dollars to be about 1% lower year on year because several European original equipment manufacturers reduced spending in the last weeks of the quarter.
  • The company said both EBITDA margin and net profit margin will decline sequentially and that earnings will fall by more than revenue because there was no time to execute cost cuts during the quarter.
  • Markets reacted violently, with the stock tumbling to fresh 52‑week lows, heavy trading and large block deals at steep discounts, and the Nifty IT index weakening as other IT stocks also sold off.
  • Major brokers cut ratings and targets after the update, with JPMorgan downgrading KPIT to Underweight and trimming its price target to ₹550 while several houses lowered FY27–29 earnings estimates.
  • KPIT described the disruption as short term, highlighted resilient pockets such as products and trucks and non‑European markets, and said it is pursuing AI‑led productivity and product investments to drive a recovery in the second half of FY27.