Shares of KPIT Technology Ltd. fell as low as 1.7% in trade on Monday after JPMorgan maintained an 'underweight' rating on the counter, with a price target of Rs 550 per share.
The brokerage's bearish stance on the stock comes on the back of damaged growth prospects. Multiple top clients decided to reprioritize their investments or not invest in software-defined vehicle programs that hurt growth prospects, according to JPMorgan.
Moreover, the company is expecting its large accounts in Japan to stabilise in the ongoing quarter, and those in the EU to stabilise in the third quarter.
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The management has also reiterated its guidance of flat revenues in the quarter ending September 30, 2026, with only some growth in the third quarter and strong growth by the last quarter of the fiscal year.
KPIT Tech's Focus is to broaden the growth through account mining, adding new clients in the passenger vehicle space, the brokerage noted.
The company is currently doubling down on commercial vehicle segments from both mining and hunting accounts and expanding into newer geographies like Southeast Asia, China, Korea and India. KPIT Tech is targeting 18% exit EBITDA margins by the fourth quarter of fiscal year 2027, compared to 17.2% seen in the first quarter.
The stock pared some losses after falling to a low of Rs 510.65 and traded 1.2% lower at Rs 512.85 apiece on the NSE as of 10:25 a.m.
The shares have fallen 56.35% year-to-date, and 57.8% in the last 12 months (one year).
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