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KPIT Technologies A highly innovative company in automotive software development, will satisfy investors’ expectations?



SAFETY ON ROADS has been a very important dream for every individual to achieve, if that safety can be achieved from the comfort of a driver on the wheels using next gen embedded software technologies, that is called as autonomous driving technology.
This autonomous software driven driving will also have its own challenges, such as to ensure safety compliance with regulations like ISO 26262 & ISO 21343. Where the former regulation ensures safety functionality by making sure the vehicle is safe to drive from the time the vehicle is bought, while the latter ensures the cyber security risk of electronic systems in vehicles.
KPIT Technology has been an independent software integration partner to global automotive leaders in the last 2 decades. Now a days automobile is defined as software on wheels, but it is difficult to achieve a software competence as there will be more complexities to reach the systematic operation of automobiles.
Their business segments include
Autonomous driving & ADAS
Electric & conventional powertrain
Connected vehicle
Digital connected solutions
Vehicle diagnostics
AUTOSAR (Automotive open system Architecture)
Vehicle engineering & design
They have a deep domain expertise across CASE (Connected, Autonomous, Shared, Electrified) domains.

Having discussed more about the technical aspects of the company, let us now look at how they are performing financially

While revenue from operations has increased by 38% YoY, Net profit has increased by 40%.


EBITDA was at 19.1% in the Q4FY23, and for YoY the EBITDA stood at 61% of increase. While the graph above shows how EBITDA change over the years.

Now let us see how the company has performed from quarter to quarter since march 22.

There has been an increasing trend in terms of revenue & PAT
Revenue from operations has grown by 27% from Q1 to Q4, while PAT has grown by 27% for the same period.

The financial prospects have been in a growing trend and we will see what its leaders have to say.

While Kishor Patil, co-founder, CEO and MD, KPIT commented on FY23 results as “they have given solid 11 sequential growth quarters in revenue and operating profits. On the back of a solid quarter, on basis of the mega engagements & committed spend on software by our strategic clients. The are expecting robust demand & increased visibility in next 4 to 5 years”.

Where are they located in the world?

They have their engineering centers in Europe, USA, Japan, China, Thailand, and India.

What are their future projects and plans?

The organization has won a TCV (Total contract value) of $ 423 million in Q423, which include TCV of $250 million for strategic engagement with Honda.
The company is expected to deliver CC revenue growth of 27-30% and EBITDA margin of around 19-20% in FY24.
KPIT are thus planning to serve the clients by focusing on alignment & collaboration of practices through broader technology solutions.

Now let us come to the crucial part of the discussion.

Is KPIT overvalued?

Let us see the trade information to analyze this:

CMP- 06/02/23 Rs.1134.05 at time of entry
Traded volume23,48,955
Total Market cap31,00,566.47
52 week high451.55(20-jun-22)
52 week low1152(02-jun-23)
Basic industryComputer-software/consulting
Date of listing22-apr-19
Face value10


TTM EPS13.920.6
TTM PE81.619.5
Market return ( 5 years)800%92%

while here we can see that though the EPS of Wipro is higher, the market is ready to pay higher price to KPIT compared to Wipro, while the sector PE of their industry stands at 28.86.
This high PE is the market’s expectation on KPIT technologies and is caused by the anticipation that KPIT will perform exceptionally well in the future.

Reasons why market is ready to pay higher price for KPIT:

• The company was trading at Rs.101/share in 2019 and now it is trading around Rs.999/share. It has given investors around 889% in these 5 years. The return on investment is high, say if an investor invested Rs.1,00,000 in 2019, now he could have got around 8 lakhs today.
• It is one of the leading automotive software integration companies which has a deep domain expertise in developing intelligent transportation system and it play an important role in software defined vehicles a reality.
• KPIT has spread its engineering centers throughout the world which includes
, KPIT GMBH, which is also a subsidiary of KPIT technologies headquartered in Munich, Germany
– also KPIT technologies headquartered in Novi, Michigan
– KPIT in Japan, Korea, and China
– also in Thailand. All these centers are well accustomed to perform various specialties of automobile technologies.
• The financials are doing well for past years and the revenue from operations kept increasing around 50% YoY basis.

With inclusions of new age technology in software integrated automotive industry with its cutting-edge expertise in its domain, KPIT will keep performing more than expected in the market.
Unless the growth rate which is good in current scenario, it would not be able to grow beyond 30-40% in future years. To achieve an uninterrupted growth the company must be consistently gaining huge orders from automobile & mobility industry. Which could also be a distant hope for the company.

Profit Making Idea

Infosys ADR Up 5% Despite Weak Results: What Should Indian Investors Do?



Hey investors! Let’s talk about Infosys and its recent ups and downs. Despite some not-so-great results, their ADR (American Depositary Receipt) is up by 5%. It’s a bit of a head-scratcher, right? So, what should you, as an Indian investor, do in this situation? Let’s break it down.

The Latest with Infosys

  • ADR Up by 5%: Even though the results weren’t strong, Infosys’ ADR went up. It seems like the market had already anticipated this, and maybe some short sellers got caught off-guard.
  • Q3 Results: The revenue barely budged, and net profit actually fell by 7% compared to last year. Not the best news, honestly.
  • In Semi Acquisition: A big move by Infosys, acquiring In Semi, a big name in semiconductor design and embedded services. This could be a game-changer in the long run.

Analyzing the Numbers

  • Profit and Revenue: The net profit is down, and revenue growth is almost flat. High interest costs are partly to blame here.
  • New Deals Dropped: New deal signings took a nosedive from $7.7 billion to $3.2 billion. That’s a big drop.
  • Attrition Rate: Good news here – it’s down to 12.9%. Less employee turnover is always a positive.
  • Guidance for FY24: Infosys expects revenue growth of 1.5%-2.0% and an operating margin of 20%-22%.

What’s the Deal with Insemi?

Insemi’s acquisition is quite a highlight. They’re leaders in the semiconductor design space. This market is booming and expected to hit $800 billion by 2028. With Insemi, Infosys could become a significant player in this field.

The Mixed Bag

  • Sector and Geographic Performance: Financial services and North America are still not performing well, but there’s some rebound in Europe.
  • Cash Flow: Infosys has a healthy free cash flow, which is a good sign for its financial health.

So, What Should You Do?

  1. Understand the Big Picture: Look beyond just this quarter. Infosys is making moves that could pay off in the long run, especially with the Insemi acquisition.
  2. Diversification: Don’t put all your eggs in one basket. It’s crucial to have a diversified portfolio.
  3. Stay Updated: Keep an eye on how Infosys performs in the coming quarters, especially in their new ventures and market segments.
  4. Risk Assessment: Be aware of the risks involved. Infosys is facing some challenges, and you need to decide if you’re comfortable with that level of risk.

Final Thoughts

Infosys’ results were a mixed bag, and the stock’s reaction was a bit surprising. As an investor, it’s essential to stay informed and make decisions based on a comprehensive understanding of the company’s performance and potential. Keep watching the market and adjust your strategy as needed. Remember, investing is a marathon, not a sprint!

Since we talked about this IT giant Infosys, Lets explore some AI based companies as well.

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Edelweiss NCD Issue: Secure Investment Opportunity



Edelweiss Financial Services Limited has announced a public issue of Secured Redeemable Non-Convertible Debentures (NCDs) worth Rs 2,500 million, offering an effective yield of up to 10.46% per annum. With credit ratings from CRISIL A+/Stable and ICRA A+, these NCDs provide a safe investment avenue.

Issue Details and Tenures

The NCDs offer ten series with fixed coupons and tenure options of 24, 36, 60, and 120 months, presenting diverse interest payment frequencies. The effective annual yield for these NCDs ranges from 8.94% to 10.46% per annum, catering to different investment preferences.

Offering Timeline and Utilization of Funds

Scheduled to open on January 9, 2024, and close on January 22, 2024, at least 75% of the raised funds will be directed towards repaying/prepaying existing borrowings, ensuring financial stability. The remainder will support general corporate purposes, aligning with SEBI NCS Regulations.

Investor Incentives and Ratings

Investors holding debentures/bonds from the company or related entities may enjoy an additional incentive of up to 0.20% p.a. These NCDs carry ratings of CRISIL A+/Stable and ICRA A+, indicating stability despite negative implications.

Lead Managers and Listing

Trust Investment Advisors Private Limited and Nuvama Wealth Management Limited are the lead managers for this NCD issue, aiming to list the NCDs on BSE Limited. This listing will provide liquidity and ease of trading for investors.

About Edelweiss Financial Services Limited

Edelweiss Financial Services Limited, established in 1995, operates in investment banking and holds a prominent position in the financial sector. Starting as an investment banking firm, it later expanded its operations, reflecting strong credentials in financial services.

Edelweiss Financial Services Limited has unveiled a lucrative investment opportunity through its NCD issue, promising secured returns and prudent utilization of funds. As the issue opens for subscription, it’s an opportune moment for investors seeking stable yet high-yield investment avenues. With a diversified range of tenure options and regular interest payments, this offering aligns with different investor preferences. The company’s extensive experience in the financial sector adds credibility to this investment opportunity, promising reliable returns.

Key Takeaways

  • Lucrative Investment Avenue
  • Secured, High-Yield Returns
  • Diverse Tenure Options
  • Prudent Utilization of Funds

This blog introduces an investment opportunity provided by Edelweiss Financial Services Limited, shedding light on its NCD issue’s specifics and the company’s background. With its high yield and secure nature, this offering presents a compelling choice for investors seeking stable returns. Learn more about financial goal planning.

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Profit Making Idea

Allcargo Terminals Hits 20% Upper Circuit: Stock Analysis



Allcargo Terminals Limited has recently hit the headlines with its stock price soaring to a 20% upper circuit. This remarkable surge raises an intriguing question: can we expect this rally to continue? Let’s dive into the company’s recent performance and sector trends to uncover insights. The upper circuit today was followed by a trendline breakout, shared by a user on twitter a few days ago.

The Catalyst Behind the Surge

Allcargo Terminals’ stock hitting the upper circuit is not just a random spike; it’s backed by solid performance and strategic moves. The company’s recent financial results for Q2FY24 show a robust 13% year-on-year increase in Container Freight Station (CFS) volumes, outpacing industry growth. But what does this mean for the stock’s future trajectory?

Analyzing Q2FY24 Performance

In Q2FY24, Allcargo Terminals demonstrated strong sequential improvement. The company not only witnessed a 6% quarter-on-quarter increase in CFS volumes but also reported revenue growth of 3% and a notable 12% increase in EBITDA. These figures indicate a positive momentum, which could be a key factor in driving the stock’s rally.

Digital Initiatives and Customer Experience

A significant aspect of Allcargo Terminals’ strategy is its focus on digital initiatives aimed at enhancing customer experience. This progressive approach is gaining traction, potentially contributing to the ongoing volume momentum. Such forward-thinking strategies are crucial in determining whether the rally has the legs to continue.

all cargo terminal analysis

Leadership and Financial Health

The induction of Mr. Pritam Vartak as CFO marks a strategic strengthening of the leadership team, potentially boosting investor confidence. Furthermore, the company’s robust balance sheet and net debt-free status provide a solid foundation for sustainable growth, which could be pivotal in maintaining the rally.

Allcargo Terminals in the Wider Logistics Sector

Allcargo Terminals, with its extensive network and digital prowess, is well-positioned in the logistics sector. As the industry navigates through a period of transformation, ATL’s innovative approach and strategic expansions could play a crucial role in sustaining its market rally.

The Road Ahead: Predicting the Rally’s Course

While Allcargo Terminals’ recent performance is impressive, predicting the stock market is always a complex endeavor. Factors such as broader market trends, economic conditions, and company-specific developments will influence the stock’s trajectory.

In conclusion, Allcargo Terminals Limited’s recent upper circuit hit reflects its strong performance and strategic initiatives. While the current indicators are positive, the sustainability of the rally will depend on continued performance excellence and favorable market conditions. What’s your take on Allcargo Terminals’ future in the stock market? Let’s engage in a discussion about the exciting possibilities ahead for this dynamic company! 🚀💹📈

We like Adani ports as well in the shipment and cargo field. Keep following us for more such technical analysis.

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