Kpit Technologies's growth is outstanding: revenue grew 39.8% and EBITDA 37.4% annually over the last three years
05-05-2014 • About Kpit Technologies (
$KPIT) • By InTwits
Have you thought about Kpit Technologies as a growth stock? Its revenue performance, profitability and healthy financial model stands it out vs. other public companies on the market.
Growth story
Kpit Technologies showed fast growth in the last financial year. Kpit Technologies's revenue surged on 20.3% in FY2014. EBITDA also increased: 14.8% for the same period.
In the longer period Kpit Technologies showed fast revenue growth of 39.8% from FY2011 to FY2014 annually. EBITDA surged on 37.4% from FY2011 to FY2014 annually.
Kpit Technologies ($KPIT) financials for the last 5 years
| mln. INR | FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Revenue | 34,080 | 9,870 | 15,000 | 22,386 | 26,940 |
|---|
| Revenue growth, % | | -71.0% | 52.0% | 49.2% | 20.3% |
|---|
| Gross margin, % | 44.1% | 36.7% | 33.8% | | |
|---|
| SG&A, % | | | | | |
|---|
| EBITDA | 1,906 | 1,614 | 2,166 | 3,642 | 4,183 |
|---|
| EBITDA growth, % | | -15.3% | 34.3% | 68.1% | 14.8% |
|---|
| EBITDA margin, % | 5.59% | 16.3% | 14.4% | 16.3% | 15.5% |
|---|
| Net Income | 857 | 946 | 1,454 | 1,990 | 2,490 |
|---|
| Net Income margin, % | 2.52% | 9.58% | 9.69% | 8.89% | 9.24% |
|---|
| |
| CAPEX | 238 | 422 | 609 | 701 | 689 |
|---|
| CAPEX/Revenue, % | 0.698% | 4.28% | 4.06% | 3.13% | 2.56% |
|---|
| Debt | 1,107 | 931 | 2,139 | 3,631 | 4,948 |
|---|
| Cash | 784 | 2,078 | 1,422 | 1,919 | 1,908 |
|---|
| Net Debt/EBITDA | 0.2x | -0.7x | 0.3x | 0.5x | 0.7x |
|---|
| |
| ROIC, % | 39.9% | 19.8% | 20.4% | 25.8% | 21.8% |
|---|
| ROE, % | 31.2% | 19.1% | 22.1% | 22.8% | 21.5% |
|---|
Profitability and return on investment
EBITDA margin declined slightly from 16.3% in FY2013 to 15.5% in FY2014. If we look for the longer period Kpit Technologies's EBITDA margin decreased slightly on 0.800 pp from 16.3% in FY2011 to 15.5% in FY2014.
We call Kpit Technologies an attractive growth stock as together with the growth it delivers high ROIC at 21.8%. During the last three years it surged - it was 19.8% in FY2011. For the last three years the average ROIC was 22.6%.
Kpit Technologies's Net Income margin increased slightly on 0.300 pp from 8.90% to 9.20% in FY2014. If we look for the longer period Net Income margin decreased slightly on 0.400 pp from 9.60% in FY2011 to 9.20% in FY2014.
Kpit Technologies operates at ROE of 21.5%. Average ROE for the last three years was 22.1%.
Capital expenditures (CAPEX)
In FY2014 the company had CAPEX/Revenue of 2.56%. Kpit Technologies showed big decline in CAPEX/Revenue of 1.72 pp from 4.28% in FY2011 to 2.56% in FY2014. It's average CAPEX/Revenue for the last three years was 3.25%.
Leverage (Debt)
The company has low debt level at 0.7x Net Debt/EBITDA - at the same time with high growth. In the longer period leverage surged on 1.44x from -0.71x in FY2011 to 0.73x in FY2014.
Management team
Kpit Technologies is headed by Shashishekhar Balkrishna Pandit "Ravi" as a CEO.
Peers in IT Consulting & Software
Below you can find Kpit Technologies benchmarking vs. other companies in IT Consulting & Software industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Tata Consultancy Services ($TCS) | | 24.3% | 31.0% | 28.8% | 29.9% |
| Mindtree ($MINDTREE) | | -65.0% | 26.6% | 23.2% | 28.8% |
| Infosys ($INFY) | | 20.9% | 22.7% | 19.6% | 24.2% |
| Sqs India Bfsi ($SQSBFSI) | | -66.5% | 46.4% | 32.9% | 20.4% |
| Cyient ($CYIENT) | | -62.7% | 30.7% | 20.6% | 17.8% |
| |
|---|
| Median (8 companies) | | -59.8% | 28.6% | 21.9% | 19.1% |
|---|
| Kpit Technologies ($KPIT) | | -71.0% | 52.0% | 49.2% | 20.3% |
Top companies by Gross margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top |
|---|
| Tata Consultancy Services ($TCS) | | | | | 47.4% |
| Infosys ($INFY) | 42.7% | 45.3% | 41.3% | 98.1% | 35.9% |
| Wipro ($WIPRO) | 31.8% | 31.5% | 29.2% | 30.4% | 32.0% |
| |
|---|
| Median (3 companies) | 37.3% | 32.8% | 31.5% | 36.2% | 35.9% |
|---|
Top companies by EBITDA margin, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Tata Consultancy Services ($TCS) | 29.0% | 29.9% | 29.5% | 28.6% | 30.7% |
| Infosys ($INFY) | 34.4% | 32.5% | 31.6% | 27.9% | 26.3% |
| Wipro ($WIPRO) | 8.3% | 21.1% | 19.1% | 20.9% | 22.4% |
| Mindtree ($MINDTREE) | 5.8% | 11.8% | 15.1% | 19.8% | 20.6% |
| Sqs India Bfsi ($SQSBFSI) | 3.9% | 3.4% | 10.6% | 18.8% | 20.5% |
| |
|---|
| Median (8 companies) | 7.4% | 18.9% | 16.3% | 19.3% | 20.5% |
|---|
| Kpit Technologies ($KPIT) | 5.6% | 16.3% | 14.4% | 16.3% | 15.5% |
Top companies by CAPEX/Revenue, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Infosys ($INFY) | 3.7% | 4.7% | 4.9% | 5.2% | 5.5% |
| Mindtree ($MINDTREE) | 1.1% | 5.6% | 2.5% | 4.5% | 5.0% |
| Cmc ($CMC) | 0.9% | 9.2% | 8.1% | 4.4% | 4.0% |
| Tata Consultancy Services ($TCS) | 3.5% | 4.9% | 4.1% | 4.2% | 3.8% |
| Cyient ($CYIENT) | 1.1% | 5.5% | 5.2% | 3.9% | 3.5% |
| |
|---|
| Median (8 companies) | 1.3% | 5.2% | 4.0% | 4.3% | 3.6% |
|---|
| Kpit Technologies ($KPIT) | 0.7% | 4.3% | 4.1% | 3.1% | 2.6% |
Top companies by ROIC, %
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Tata Consultancy Services ($TCS) | 44.7% | 47.1% | 48.6% | 48.4% | 50.2% |
| Mindtree ($MINDTREE) | 26.4% | 14.9% | 24.9% | 34.6% | 36.2% |
| Cmc ($CMC) | 32.0% | 31.5% | 26.2% | 33.2% | 35.3% |
| Sqs India Bfsi ($SQSBFSI) | 14.0% | 0.1% | 12.1% | 27.0% | 29.4% |
| Infosys ($INFY) | 32.2% | 32.1% | 32.4% | 28.3% | 27.2% |
| |
|---|
| Median (8 companies) | 25.0% | 18.1% | 22.4% | 27.6% | 28.3% |
|---|
| Kpit Technologies ($KPIT) | 39.9% | 19.8% | 20.4% | 25.8% | 21.8% |
Top companies by Net Debt / EBITDA
| FY2010 | FY2011 | FY2012 | FY2013 | FY2014 |
|---|
| Top 5 |
|---|
| Mindtree ($MINDTREE) | -0.1x | -0.1x | -0.0x | -0.2x | -0.2x |
| Cmc ($CMC) | -0.1x | -0.2x | -0.2x | -0.4x | -0.3x |
| Tata Consultancy Services ($TCS) | -0.5x | -0.4x | -0.4x | -0.4x | -0.6x |
| Sasken Communication Technologies ($SASKEN) | 0.1x | -0.2x | -0.3x | -0.7x | -0.6x |
| Wipro ($WIPRO) | -0.0x | -0.1x | -0.3x | -0.3x | -0.6x |
| |
|---|
| Median (8 companies) | -0.2x | -0.3x | -0.3x | -0.5x | -0.6x |
|---|
| Kpit Technologies ($KPIT) | 0.2x | -0.7x | 0.3x | 0.5x | 0.7x |
