KPIT reports Q1 FY23 revenue growth of 23 percent Y-O-Y and Net Profit growth of over 41 percent Y-O-Y

KPIT Q1FY2023 Performance Overview

Q1FY23 CC Revenue grows 23% YoY
Q1FY23 reports YoY Net Profit growth of 41%+

Q1FY23 Revenue

CC Revenue Growth of 23% Y-o-Y, 6.0% Q-o-Q, $ Revenue Growth of 16.4% Y-o-Y and 3.2% Q-o-Q

Operating Margins

Q1FY23 EBITDA at 19.4% against 18.6% last qtr. Y-o-Y EBITDA growth of 35.7%, 9.7% Q-o-Q

Q1FY23 Profit

Net Profit at ₹ 854 million. Net Profit growth of 41%+ Y-o-Y, 8.3% Q-o-Q

New Engagements

New wins continue to be stronger, TCV of $ 155 million won during the quarter

Q1FY2023 Performance Highlights

Sequential CC growth of 6% led by Electric Powertrain and architecture and middleware domains. Growth steered by passenger car vertical. Higher cross currency impact due to Euro, GBP and Yen depreciation against the INR.

EBITDA expansion of 80 bps despite supply side constraints, fresher additions and cross-currency headwinds. Operating efficiency, net realization improvement and revenue growth leading to consistent improvement in margins

Healthy growth in net profit aided by improvement in operating margins and higher other income. ETR for the quarter higher as compared to last quarter, as a result of one-time benefit last quarter.

High cash conversion continued post acquisition payout, with DSO at 46 days. Net Cash at quarter end ₹ 10.6 billion. 14th consecutive quarter of increase in net cash and healthy cash conversion

Management Quotes

The vehicle manufacturers are aiming to earn revenues over the life of the vehicle for sustainable growth. This change will be enabled by CASE and centralized architecture programs, essentially Software Driven Vehicles. KPIT is uniquely positioned as a software integrator, helping global OEMs accelerate this journey. We have started the year on a positive note with an all-round performance, with growth in-line with our plan and healthy margin expansion, despite cross-currency headwinds. We remain optimistic on the overall growth environment

Kishor Patil

Co founder, CEO and MD, KPIT

It has been our goal to uphold all our client commitments and help our clients become successful, by leveraging technology. This relentless focus on our strategic clients continues to yield great results, resulting in larger, strategic engagements. Supply side pressures continue to persist, albeit at an eased pace. We have nurtured the existing partnerships and formed new ones with global universities to help attract global talent and aid retention by enabling career growth opportunities to our employees, with focused educational programs

Sachin Tikekar

President and Joint MD, KPIT

Deal Wins

TCV of new engagements won during the Quarter $ 155 million

1

A leading European Car Manufacturer selected KPIT for a multiyear engagement in the electric powertrain domain

2

A leading Asian Car Manufacturer awarded KPIT multiple programs in the connected and middleware domains

3

A leading American Commercial Vehicle Manufacturer selected KPIT for a multiyear engagement in the Vehicle Engineering and Design domain

4

A leading European Car Manufacturer selected KPIT for a strategic program in the middleware domain

5

A leading American Tier I awarded KPIT multiple programs in the powertrain domain

Financial and operational Data

Profit & Loss Account Snapshot

INR MN

DETAILS Q1FY23 Q4FY22 Q1FY21
Revenue from Operations 6,857.24 6,517.65 5,673.81
Other Income 152.89 127.54 99.76
Total Income 7,010.13 6,645.19 5,773.57
Operating Expenses 5,525.51 5,303.69 4,692.65
EBITDA 1,331,73 1,213.96 981.16
Depreciation 310.23 307.18 286.46
EBIT 1,021.50 906.78 694.70
Finance Costs 63.43 70.46 40.10
Change in FMV of Investments 6.12 2.93 21.60
Profit Before Exceptional Items 1,117.08 966.79 775.96
Exceptional items – – –
Profit/(loss) of equity accounted investee 3.77 5.37 –
PBT 1,120.85 972.16 775.96
Tax 244.26 166.28 173.50
PAT 876.59 805.88 602.46
Profit Attributable to owners of company 854.28 788.77 602.46
Profit Attributable to non-controlling interest 22.31 17.11 –

Balance Sheet Snapshot

INR MN

ASSETS Q1FY23 Q4FY22
NON-CURRENT ASSETS
Property, Plant & Equipment 1,905.94 1,936.72
Right-of-use Assets 2,363.81 2,503.32
Other Tangible Assets 11.39 4.09
Goodwill & Other Intangibles 2,323.74 1,968.43
Other Non-Current Assets 1,427.25 1,400.51
TOTAL NON-CURRENT 8,032.13 7,813.07
CURRENT ASSETS
Inventories NIL NIL
Cash and Cash Equivalents 10,627.06 10,380.32
Trade Receivables 3,413.04 3,714.47
Other Current Assets 2,188.29 1,453.61
TOTAL CURRENT 16,228.39 15,548.40
TOTAL ASSETS 24,260.52 23,361.47
EQUITY & LIABILITIES Q1FY23 Q4FY22
Equity Share Capital 2,700.97 2,700.17
Other Equity 11,210.05 10,395.50
Equity attributable to owners 13,911.02 13,095.67
Non-controlling interests 175.32 155.47
TOTAL EQUITY 14,086.34 13,251.14
NON-CURRENT LIABILITIES
Borrowings NIL NIL
Lease Liabilities 1,709.83 1,833.95
Other Non-Current Liabilities 1,220.20 1,199.78
TOTAL NON-CURRENT 2,930.03 3,033.73
CURRENT LIABILITIES
Borrowings NIL NIL
Trade Payables 1,398.29 1,372.30
Lease Liabilities 408.45 412.51
Others 5,437.41 5,291.79
TOTAL CURRENT 7,244.15 7,076.60
TOTAL EQUITY AND LIABILITIES 24,260.52 23,361.47

Revenue Break-up

USD MN

Verticals* Q1FY23 Q4FY22 Q1FY22 Q-o-Q Y-o-Y
Passenger Cars 66.95 62.88 58.40 6.5% 14.6%
Commercial Vehicles 22.38 22.04 17.95 1.5% 24.7%
Business Units** Q1FY23 QFY22 Q1FY22 Q-o-Q Y-o-Y
Feature Development & Integration 61.64 60.80 54.06 1.4% 14.0%
Architecture & Middleware Consulting 12.83 9.79 9.01 31.1% 42.4%
Cloud Based Connected Services 15.41 16.52 14.14 (6.7%)% 9.0%
Geography Q1FY23 Q4FY22 Q1FY21 Q-o-Q Y-o-Y
US 34.95 33.10 31.76 5.6% 10.0%
Europe 35.89 34.27 30.37 4.7% 18.2%
Asia 19.04 19.73 15.07 (3.5)% 26.3%

*The balance revenues come from others, which is not a big area as of now

**Feature Development & Integration – Electrification, AD-ADAS, Body Electronics and VED
Architecture & Middleware Consulting – Middleware, AUTOSAR
Cloud Based Connected Services – Intelligent Cockpit, Digital Connected Solutions and Diagnostics

P&L Metrics

Q1FY23 Q4FY22 Q1FY22 Q-o-Q Y-o-Y
Revenue by Contract Type
Time & Material Basis 51.0% 48.1% 43.6% 9.4% 36.2%
Fixed Price Basis 49.0% 51.9% 56.4% (2.6)% 1.1%
Clients
Strategic T21 Client Revenue 84.5%* 83.8%* 84.6% 5.0% 11.5%
Active Clients (Period End) 60 60 55
Revenue per Devp. Employee USD 41,951 45,679 51,257
R&D Expenditure (USD MN) 2.13 2.09 2.19
EBITDA Margin 19.4% 18.6% 17.3%
EBIT Margin 14.9% 13.9% 12.2%
PAT Margin 12.5% 12.1% 10.6%
Effective Tax Rate 21.8% 17.1% 22.4%
EPS (Basic) 3.16 2.92 2.24
EPS (Diluted) 3.13 2.89 2.21

*Excluding PP revenues

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KPIT is a leading independent software development and integration partner helping mobility leapfrog towards a clean, smart, and safe future. With 7000 automobelievers across the globe specializing in embedded software, AI, and digital solutions, KPIT accelerates clients’ implementation of next-generation technologies for the future mobility roadmap. With engineering centers in Europe, the USA, Japan, China, Thailand, and India, KPIT works with leaders in automotive and mobility and is present where the ecosystem is transforming.

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KPIT Technologies Ltd

Plot Number-17,
Rajiv Gandhi Infotech Park,
MIDC-SEZ, Phase-III,
Hinjawadi, Pune – 411057
Phone: +91 20 6770 6000

KPIT Technologies GmbH

Frankfurter Ring 105b,80807
Munich, GERMANY
Phone: +49 89 3229 9660
Fax: +49 89 3229 9669 99

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