Multibagger stock: KPIT Tech up 120% from 52-week low! Is there more steam left in this IT counter?
Recently, the company reported its earnings for the first quarter of FY24. It posted an 56.8 per cent year-on-year rise in its consolidated net profit to Rs 133.9 crore.
- Aug 18, 2023,
- Updated Aug 18, 2023 3:47 PM IST
Shares of KPIT Technologies have zoomed over 100 per cent in just a year. The multibagger stock is also up over 220 per cent in the last two years. Back in August 2020, the stock was trading around Rs 80. It is now hovering around Rs 1,150 mark and has recovered over 120 per cent from its 52-week low of Rs 522.45.
Recently, the company reported its earnings for the first quarter of FY24. It posted an 56.8 per cent year-on-year rise in its consolidated net profit to Rs 133.9 crore. It had reported a profit of Rs 85.4 crore in the year-ago period. Sequentially, consolidated net profit was up by 20 per cent from Rs 111.6 crore in Q4FY23. The revenue growth in constant currency terms was up by 51.7 per cent year-on-year.
JP Morgan on KPIT Technologies
JP Morgan, in its recent report, said that the Engineering R&D spend slowdown seen over the last six months is structural in nature and not cyclical. The foreign brokerage has a target price of Rs 540 for KPIT Technologies.
"We believe the Engineering R&D spends slowdown seen over the last six months is structural and not cyclical, which makes current valuations super rich. ER&D services firms benefitted from increased digital spends in areas of Industry 4.0, factory automation, OTTs and connected health over the last three years, but the current tough macro has questioned the trajectory of these spends," it said.
What do the technical charts suggest?
According to Osho Krishan, Sr. Analyst - Technical & Derivative Research, Angel One, KPIT Tech underwent a brief consolidation post its stellar rally in the current financial year; it has resumed its uptrend with a breakout above 1100 on the daily charts.
"The stock is currently facing a hurdle around its previous all-time high, which is quite anticipatory. But the technical undertone of the stock remains robust, and we are likely to see the stock inch higher in the near period," he said.
"As far as levels are concerned, the stock as mentioned, has a resistance around its ATH of 1160-1180 and in case of a downside, is likely to find support in the 1110-1100 zone in the short term with the sacrosanct backing in the 1000-950 zone," Krishan added.
"The stock has witnessed tough resistance zone near 1165-1170 levels and would need a decisive breach above this zone to trigger for a breakout and anticipate for further upward move with next target expected till 1310 levels," said Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher Pvt.
"On the downside, we have the near-term support at around 1110 which is also where the important 50EMA lies and a decisive breach below that would turn the bias weak anticipating for further downward movement," Parekh added.
About KPIT Technologies
KPIT Technologies Limited is a technology company, which is focused on automobile engineering and mobility solutions. The company offers electronic and mechanical engineering solutions to its customers.
It also analyses data for diagnostics, maintenance and tracking of assets and related connectivity solutions, including data and analytics beyond embedded or mechanical engineering and their connectivity and integration with back-end information technology (IT) systems and platforms for the automobile and mobility sector.
Disclaimer: The stocks mentioned in the story are for information purposes only. Investors or market participants should consult their financial advisors before taking any position
Also read: Hot stocks on August 18, 2023: Adani Power, Indian Bank, Adani Green Energy, PTC Industries and more
Also read: 140% return in 2023! Zensar Tech stock rally defies broader IT sector weakness
Shares of KPIT Technologies have zoomed over 100 per cent in just a year. The multibagger stock is also up over 220 per cent in the last two years. Back in August 2020, the stock was trading around Rs 80. It is now hovering around Rs 1,150 mark and has recovered over 120 per cent from its 52-week low of Rs 522.45.
Recently, the company reported its earnings for the first quarter of FY24. It posted an 56.8 per cent year-on-year rise in its consolidated net profit to Rs 133.9 crore. It had reported a profit of Rs 85.4 crore in the year-ago period. Sequentially, consolidated net profit was up by 20 per cent from Rs 111.6 crore in Q4FY23. The revenue growth in constant currency terms was up by 51.7 per cent year-on-year.
JP Morgan on KPIT Technologies
JP Morgan, in its recent report, said that the Engineering R&D spend slowdown seen over the last six months is structural in nature and not cyclical. The foreign brokerage has a target price of Rs 540 for KPIT Technologies.
"We believe the Engineering R&D spends slowdown seen over the last six months is structural and not cyclical, which makes current valuations super rich. ER&D services firms benefitted from increased digital spends in areas of Industry 4.0, factory automation, OTTs and connected health over the last three years, but the current tough macro has questioned the trajectory of these spends," it said.
What do the technical charts suggest?
According to Osho Krishan, Sr. Analyst - Technical & Derivative Research, Angel One, KPIT Tech underwent a brief consolidation post its stellar rally in the current financial year; it has resumed its uptrend with a breakout above 1100 on the daily charts.
"The stock is currently facing a hurdle around its previous all-time high, which is quite anticipatory. But the technical undertone of the stock remains robust, and we are likely to see the stock inch higher in the near period," he said.
"As far as levels are concerned, the stock as mentioned, has a resistance around its ATH of 1160-1180 and in case of a downside, is likely to find support in the 1110-1100 zone in the short term with the sacrosanct backing in the 1000-950 zone," Krishan added.
"The stock has witnessed tough resistance zone near 1165-1170 levels and would need a decisive breach above this zone to trigger for a breakout and anticipate for further upward move with next target expected till 1310 levels," said Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher Pvt.
"On the downside, we have the near-term support at around 1110 which is also where the important 50EMA lies and a decisive breach below that would turn the bias weak anticipating for further downward movement," Parekh added.
About KPIT Technologies
KPIT Technologies Limited is a technology company, which is focused on automobile engineering and mobility solutions. The company offers electronic and mechanical engineering solutions to its customers.
It also analyses data for diagnostics, maintenance and tracking of assets and related connectivity solutions, including data and analytics beyond embedded or mechanical engineering and their connectivity and integration with back-end information technology (IT) systems and platforms for the automobile and mobility sector.
Disclaimer: The stocks mentioned in the story are for information purposes only. Investors or market participants should consult their financial advisors before taking any position
Also read: Hot stocks on August 18, 2023: Adani Power, Indian Bank, Adani Green Energy, PTC Industries and more
Also read: 140% return in 2023! Zensar Tech stock rally defies broader IT sector weakness