KPIT Technologies Q1: Why Shares Gained Despite Drop in Q1 Net

KPIT Technologies surged as much as 13 per cent on Thursday after the outsourcer reported better-than-expected margins in Q1. KPIT Technologies' ebitda or operating margin jumped 510 basis points to 9.61 per cent as compared to the previous quarter.
  Anil Patwardhan, senior VP and head-corporate finance & governance told NDTV, "Operational efficiency has triggered the margin improvement which I believe is sustainable."
  KPIT Technologies, however, reported a 3.3 per cent sequential drop in its dollar revenue at $118.3 million. In rupee terms, KPIT Technologies' revenue fell 0.6 per cent sequentially to Rs 758 crore, while net profit declined 11.7 per cent to Rs 44.4 crore.
  June quarter net profit is not comparable with the March quarter because the previous quarter saw a tax credit of Rs 35.2 crore.
  "The revenue decline in Q1 is attributable to our products and platform business, which is cyclical in nature but on services side there has been a growth of 3.4 per cent on sequential basis," Mr Patwardhan said.
  KPIT said the decline in products and platform business has stabilised now and going forward "we don't see further decline."
  KPIT Technology shares closed 5.64 per cent higher at Rs 112.1 on Thursday compared to 0.51 per cent fall in the broader Nifty.