KPIT Technologies Ltd — Interim / Quarterly Report 2023

Jul 26, 2022

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KP 11·

July 26, 2022

BSE Limited

Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai - 400001.

Scrip ID: KPITTECH Scrip Code: 542651

Kind Attn: The Manager, Department of Corporate Services

National Stock Exchange of India Ltd., Exchange Plaza, Cl 1, G Block, Bandra - Kurla Complex, Bandra (E), Mumbai - 400051.

Symbol: KPITTECH Series: EQ

Kind Attn: The Manager, Listing Department

Subject: Investor Update - Q1 FY 2023.

Dear Sir I Madam,

Please find enclosed the investor Update - Q1 FY 2023.

Kindly take the same on your records.

Thanking you.

Yours faithfully,

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For KPIT Technologies Limited

Nida Deshpande Company Secretary & Compliance Officer

Encl.: - As mentioned above.

KPIT Technologies Limited (Formerly KPIT Engineering Limited) Registered & Corporate Office: Plot No. 17, Rajiv Gandhi lnfotech Park, MIDC-SEZ, Phase-Ill, Maan, Taluka-Mulshi, Hinjawadi, Pune-411057, India. CIN: L74999PN2018PLC174192

0 +91 20 6770 6000 E info@kpit.com W kpit.com

Reimagining Mobility with YOU

July 26, 2022 Investor Update Q1FY2023

KPIT Technologies Ltd.

Forward Looking Statements

Some of the statements in this update that are not historical facts, are forward-looking statements. These forward-looking statements include our financial and growth projections, as well as statements concerning our plans, strategies, intentions and beliefs concerning our business and the markets in which we operate. These statements are based on information currently available to us, and we assume no obligation to update these statements as circumstances change. There are risks and uncertainties that could cause actual events to differ materially from these forward-looking statements. These risks include, but are not limited to, the level of market demand for our services, the competitive market for the type of services and solutions that we offer, market conditions that could cause our clients to reduce their spending for our services, our ability to create, acquire and build new businesses and to grow our existing businesses, our ability to attract and retain qualified personnel, currency fluctuations and market conditions in India and elsewhere around the world, and other risks not specifically mentioned herein but those that are common to industry

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• 1 March 2021

Performance Overview

Q1FY23

Reimagining Mobility withYOU

Performance Overview

Q1FY23 CC Revenue grows 23% YoY Q1FY23 reports YoY Net Profit growth of 41%+

Q1FY23

Q1FY23 CC Revenue Growth of 23% Y-o-Y, 6.0% Q-o-Q 1 Revenue $ Revenue Growth of 16.4% Y-o-Y and 3.2% Q-o-Q

Operating Q1FY23 EBITDA at 19.4% against 18.6% last qtr. 2 Margins Y-o-Y EBITDA growth of 35.7%, 9.7% Q-o-Q

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Q1FY23 Net Profit at ₹ 854 million 3 Profit Net Profit growth of 41%+ Y-o-Y, 8.3% Q-o-Q New New wins continue to be stronger 4 T TCV of $ 155 million won during the quarter Engagements

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Performance Highlights

Sequential CC growth of 6% led by Electric Powertrain and architecture and middleware domains. Growth steered by 01 passenger car vertical. Higher cross currency impact due to Euro, GBP and Yen depreciation against the INR.

EBITDA expansion of 80 bps despite supply side constraints, fresher additions and cross-currency 02 headwinds. Operating efficiency, net realization improvement and revenue growth leading to consistent improvement in margins

Healthy growth in net profit aided by improvement in operating margins and higher other income. ETR for the 03 quarter higher as compared to last quarter, as a result of one-time benefit last quarter.

High cash conversion continued post acquisition payout, with DSO at 46 days. Net Cash at quarter end ₹ 10.6 billion. 04 14[th] consecutive quarter of increase in net cash and healthy cash conversion

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Additional facts - timeseries

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Revenue $ M
[89.9]
[87.1]
[76.9 76.9] [77.2][ 80.4 83.7]
[77.2]
71.1 [72.8]
65.3 65.3 [69.7 74.5]
Qtr. End Net Cash ₹ B
8.22 [8.78 9.3310.2310.3810.62]
5.28 [6.30]
[2.04 2.58 3.28 3.94]
0.90 [1.81]
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EBITDA %
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19.4%
17.2% [17.3%17.6%18.5%18.6%]
13.4%
15.7%
13.5%
14.6%
13.4% 13.4% [14.3%]
12.8%
EBITDA ₹ M
[1,041][1,150][1,214][1,332]
931 [981]
639 [739] [727] [737] [751] [662] [697] [811]
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EBITDA ₹ M

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Management Quotes

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Kishor Patil, Co-founder, CEO and MD, KPIT said,” The vehicle manufacturers are aiming to earn revenues over the life of the vehicle for sustainable growth. This change will be enabled by CASE and centralized architecture programs, essentially Software Driven Vehicles. KPIT is uniquely positioned as a software integrator, helping global OEMs accelerate this journey. We have started the year on a note with an all-round with in-line with our positive performance, growth plan and healthy margin expansion, despite cross-currency headwinds. We remain optimistic on the overall growth environment”.

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Sachin Tikekar, President and Joint MD, KPIT said, ” It has been our goal to uphold all our client commitments and help our clients become successful, by leveraging technology. This relentless focus on our strategic clients continues to yield great results, resulting in larger, strategic engagements. Supply side pressures continue to persist, albeit at an eased pace. We have nurtured the existing partnerships and formed new ones with global universities to help attract global talent and aid retention by enabling career growth opportunities to our employees, with focused educational programs”.

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Cash Flow – Major Movement

INR Million Increase in Working Capital – 369

Capex – 228 SOMIT Payout - 324

Cash and Cash Equivalents break-up ₹ M In Investment Accounts (in India) 5,846 In Investment Accounts (outside India) 1,397 In Operating Accounts 3,384 TOTAL 10,627

	Q-o-Q Increase in Net Cash : INR 247 Million	Q-o-Q Increase in Net Cash : INR 247 Million	Q-o-Q Increase in Net Cash : INR 247 Million	Q-o-Q Increase in Net Cash : INR 247 Million
	NET CASH (INR Mln)		Q1FY23	Q4FY22
	Gross Cash		10,627	10,380
	Long Term Debt		NIL	NIL
	Short Term Debt		NIL	NIL
	NET CASH		10,627	10,380

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DSO Q1FY23 end : 46 Days

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New Engagements

TCV of new engagements won during the Quarter : $ 155 million

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A leading European Car Manufacturer selected KPIT for a multiyear engagement in the electric powertrain domain

A leading Asian Car Manufacturer awarded KPIT multiple programs in the connected and middleware domains

• A leading American Commercial Vehicle Manufacturer selected KPIT for a multiyear engagement in the Vehicle Engineering and Design domain

A leading European Car Manufacturer selected KPIT for a strategic program in the middleware domain

A leading American Tier I awarded KPIT multiple programs in the powertrain domain

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FY23 – Outlook

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Growth
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CC Revenue Growth : 18% to 21%

Broad based growth across practices, led by Strategic Clients and Strategic Engagements. Volume Growth to be in the range of 25%. Reported $ growth will be impacted adversely due to cross currency headwinds

EBITDA Margin : 18% to 19%

Improvement in Revenue mix towards offshore and fixed price. Growth Leverage. Focus on net realization improvement

People

Supply side pressures to continue in FY23. Focus on Talent development and retention. Increments, promotions higher than average.

Investments

Technology led R&D Investments, Market facing investments, total 3+% of revenue

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• 1 March 2021

Other Updates

Q1FY23

Reimagining Mobility withYOU

KPIT expands its team and global infra-structure footprint

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KPIT unveiled its brand-new office in Novi, Michigan, USA

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KPIT expands its local tech center in China

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KPIT to create opportunities in cutting edge automotive software in Kochi

Brand new beginnings!

A bigger, better located, futuristic premise aligned with our goal of being the #BestPlaceToGrow for KPITians in USA!

KPIT has taken the initiative to add KPIT plans to tap into talent in 20 AUTOSAR engineers in Phase 1 to different hubs of India and continue build a Local Tech Center in China. to look for engineers who are This workforce will consist of 10 passionate about automotive senior engineers and ten fresh technologies. graduates / Interns. The team has Kochi Center expansion will offer a already onboarded seven senior great combination of challenge, engineers and five interns. culture, and growth for talent in the region and people who wish to move closer home.

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KPIT Sparkle Innovation Platform for Talent Outreach

Mission

Objective

Support, nurture, and mentor students in the STEM field with a particular focus on areas of mobility and energy

Identify & develop best innovative talent across the country and instill an innovation culture at the grassroot

• India’s biggest innovation platform for UG to PhD students to Ideate and Innovate

• Nurtures and recognizes the country’s young innovators towards building a better and cleaner tomorrow

• Platform’s multidisciplinary outlook empowers tech enthusiasts to solve society’s biggest challenges

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Glimpses from the event

Sparkling Statistics (2015 – 2022)

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KPIT – Societal Development Commitment

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• Water Conservation • KPIT SPARKLE (Engg. Innovation)
• Forest Conservation • SHODH (PhD researchers)
•
Chotte Scientists (School Children)
ENVIRONMENT EDUCATION
Transforming lives of
Making this world a
people through science &
better place to live in
technology education
KPIT SOCIETAL
DEVELOPMENT
Developing innovative COMMITMENT
Utilizing employee
solutions for efficient
strength to make a
energy consumption difference
and renewable supply
ENERGY ENGAGEMENT
• •
Alternate Energy Dedicated Time
• •
Renewable Energy Volunteer Development
•
COVID Warriors
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KPIT is a Socially Responsible Corporate Citizen in each country it works

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KPIT Technologies bags award for Sustainability Initiatives at Workplace

KPIT has won the 1st Prize at iNFHRA’s Pune Chapter 6th Edition of Workplace Excellence under the category of “Sustainability”.

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7/26/2022 15

We are Excited to go live on Instagram

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• 1 March 2021

Financial & Operational Data

Snapshot

Reimagining Mobility withYOU

INR MN

Profit & Loss Account Snapshot

DETAILS	Q1FY23	Q4FY22	Q1FY22
Revenue from Operations	6,857.24	6,517.65	5,673.81
Other Income	152.89	127.54	99.76
Total Income	7,010.13	6,645.19	5,773.57
OperatingExpenses	5,525.51	5,303.69	4,692.65
EBITDA	1,331,73	1,213.96	981.16
Depreciation	310.23	307.18	286.46
EBIT	1,021.50	906.78	694.70
Finance Costs	63.43	70.46	40.10
Change in FMV of Investments	6.12	2.93	21.60
Profit Before Exceptional Items	1,117.08	966.79	775.96
Exceptional items	-	-	-
Profit/(loss) from equity accounted investee	3.77	5.37	-
PBT	1,120.85	972.16	775.96
Tax	244.26	166.28	173.50
PAT	876.59	805.88	602.46
Profit Attributable to owners of Company	854.28	788.77	602.46
Profit Attributable to non-controllinginterest	22.31	17.11	-

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INR MN

Balance Sheet Snapshot

ASSETS	Q1FY23	Q4FY22		EQUITY & LIABILITIES	Q1FY23	Q4FY22
NON-CURRENT ASSETS				EquityShare Capital	2,700.97	2,700.17
				Other Equity	11,210.05	10,395.50
Property, Plant & Equipment	1,905.94	1,936.72
				Equityattributable to owners	13,911.02	13,095.67
Right-of-use Assets	2,363.81	2,503.32
				Non-controllinginterests	175.32	155.47
Other Tangible Assets	11.39	4.09
				TOTAL EQUITY	14,086.34	13,251.14
Goodwill & Other Intangibles	2,323.74	1,968.43		N ON-CURRENT LIABILITIES
Other Non-Current Assets	1,427.25	1,400.51		Borrowings	NIL	NIL
				Lease Liabilities	1,709.83	1,833.95
TOTAL NON-CURRENT	8,032.13	7,813.07
				Other Non-Current Liabilities	1,220.20	1,199.78
CURRENT ASSETS
				TOTAL NON-CURRENT	2,930.03	3,033.73
Inventories	NIL	NIL
				CURRENT LIABILITIES
Cash and Cash Equivalents	10,627.06	10,380.32		Borrowings	NIL	NIL
Trade Receivables	3,413.04	3,714.47		Trade Payables	1,398.29	1,372.30
				Lease Liabilities	408.45	412.51
Other Current Assets	2,188.29	1,453.61
				Others	5,437.41	5,291.79
TOTAL CURRENT	16,228.39	15,548.40
				TOTAL CURRENT	7,244.15	7,076.60
TOTAL ASSETS	24,260.52	23,361.47
				TOTAL EQUITY AND LIABILITIES	24,260.52	23,361.47

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USD MN

Revenue Break-up

Verticals*	Q1FY23	Q4FY22	Q1FY22	Q-o-Q	Y-o-Y
Passenger Cars	66.95	62.88	58.40	6.5%	14.6%
Commercial Vehicles	22.38	22.04	17.95	1.5%	24.7%

• The balance revenues come from others, which is not a big area as of now

Business Units#	Q1FY23	Q4FY22	Q1FY22	Q-o-Q	Y-o-Y
Feature Development & Integration	61.64	60.80	54.06	1.4%	14.0%
Architecture & Middleware Consulting	12.83	9.79	9.01	31.1%	42.4%
Cloud Based Connected Services	15.41	16.52	14.14	(6.7%)	9.0%

Feature Development & Integration - Electrification, AD-ADAS, Body Electronics and VED Architecture & Middleware Consulting – Middleware, AUTOSAR

Cloud Based Connected Services – Intelligent Cockpit, Digital Connected Solutions and Diagnostics

Geography	Q1FY23	Q4FY22	Q1FY22	Q-o-Q	Y-o-Y
US	34.95	33.10	31.76	5.6%	10.0%
Europe	35.89	34.27	30.37	4.7%	18.2%
Asia	19.04	19.73	15.07	(3.5)%	26.3%

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P&L Metrics

		Q1FY23	Q4FY22	Q1FY22	Q-o-Q	Y-o-Y
	Revenue by Contract Type
	Time & Material Basis	51.0%	48.1%	43.6%	9.4%	36.2%
	Fixed Price Basis	49.0%	51.9%	56.4%	(2.6)%	1.1%
	Clients
	Strategic Client Revenue	84.9%	83.6%	85.7%	4.7%	15.3%
	Active Clients (Period End)	60	60	55
	Revenue per Devp. Employee USD 41,951 45,679 51,257 R&D Expenditure (USD MN) 2.13 2.09 2.19 EBITDA Margin 19.4% 18.6% 17.3% EBIT Margin 14.9% 13.9% 12.2% PAT Margin 12.5% 12.1% 10.6% Effective Tax Rate 21.8% 17.1% 22.4% EPS (Basic) 3.16 2.92 2.24 EPS (Diluted) 3.13 2.89 2.21
	R&D Expenditure (USD MN)
	EBITDA Margin
	EBIT Margin
	PAT Margin
	Effective Tax Rate
	EPS (Basic)
	EPS (Diluted)

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wise Currency revenues, Hedging Details

Currency wise revenue	Q1FY23	Q4FY22	Q1FY22
USD	42.7%	40.0%	41.7%
EUR	33.5%	32.2%	33.0%
GBP	6.3%	6.6%	5.7%
JPY	8.7%	12.4%	10.2%
INR	5.8%	5.9%	4.9%
Others	2.9%	2.9%	4.6%
Realized Rate Q1FY23 Q4FY22 Q1FY22
INR/USD 76.29 74.82 73.49

O/s Hedge Details	Q1FY23
Hedge Rates
USD/INR	78.87
EUR/INR	88.74
GBP/INR	104.50
Hedge Amounts(Mn)
USD/INR	47.92
EUR/INR	10.90
GBP/INR	3.40

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Headcount Data

Period End Headcount	Q1FY23	Q4FY22	Q1FY22	Q-o-Q	Y-o-Y
Development	8,570	7,628	6,025	-	-
Enabling & Sales	613	617	539	-	-
Total	9,183	8,245	6,564	-	-

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• 1 March 2021

Contact Us

Reimagining Mobility withYOU

Conference Call Details

Conference name : KPIT Technologies Q1 FY2023 Post Earnings Conference Call Date : Tuesday July 26, 2022 Time : 1730 Hrs. Participants : Mr. Kishor Patil, Co-founder, CEO & MD Mr. Sachin Tikekar, President, Joint MD Mrs. Priya Hardikar, CFO Mr. Sunil Phansalkar, Head-IR Dial-in Numbers for all participants Diamond Pass Registration (choruscall.in) Primary number : +91 22 6280 1116 Local Access : +91 22 7115 8017 - - - International Numbers : USA 1 866 746 2133 | UK 0 808 101 1573 | Singapore 800 101 2045 - Hongkong 800 964 448

About KPIT Technologies

KPIT (BSE: 542651; NSE: KPITTECH), KPIT is a global technology company with software solutions that will help mobility leapfrog towards autonomous, clean, smart and connected future. With 9,000+ Automobelievers across the globe, specializing in embedded software, AI & Digital solutions, KPIT enables clients accelerate implementation of next generation mobility technologies. With development centers in Europe, USA, Japan, China, – Thailand and India KPIT works with leaders in mobility and is present where the ecosystem is transforming. 25 For more information, visit http://www.kpit.com

Contact

For Investor Queries

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Email Sunil.Phansalkar@kpit.com

Desk Phone

• 91 20 6770 6997

Cell + 91 98509 66011

Website www.kpit.com

Sunil Phansalkar

26

Contact

For Media Queries

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Email Sunil.R@kpit.com

Desk Phone + 91 80 6606 6000 (7865)

Cell + 91 99001 50180

Website www.kpit.com

Sunil B R

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THANK YOU !!

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KPIT Technologies Ltd.