KPIT Technologies Ltd — Interim / Quarterly Report 2022

Feb 1, 2022

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KP 11·

February 1, 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, C/1, G Block, Bandra - Kurla Complex, Bandra (E), Mumbai - 400051.

Symbol: KPITTECH Series: EQ

Kind Attn: The Manager, Listing Department

• Subject: Investor Update Q3 FY 2022.

Dear Sir / Madam,

• Please find enclosed the investor Update Q3 FY 2022.

Kindly take the same on your records.

Thanking you.

Yours faithfully,

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For KPIT Technologies Limited

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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.

0 +91 20 6770 6000 E info@kpit.com W kp1t.com

CIN: L74999PN2018PLC174192

Reimagining Mobility with YOU

February 01, 2022 Investor Update Q3FY2022 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

Q3FY22

Reimagining Mobility withYOU

Q3FY22 Performance Overview

KPIT Q3FY22 USD Revenue grows 20% Y-o-Y Y-o-Y Net Profit growth of 67.6%

Q3FY22 CC Revenue growth of 21.2% Y-o-Y, 5.6% Q-o-Q 1 Q3FY22 EBITDA at 18.5% as against 17.6% last quarter

Net Profit for the quarter at ₹ 700 million as against 2 ₹ 651 million last quarter, Q-o-Q growth of 7.5% Net Cash as at quarter end crosses the ₹ 10 billion mark. 3 Interim Dividend of ₹ 1.25 per share

Annual EBITDA outlook raised, Yearly EBITDA to be 4 around 18%

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Q3FY22 Performance Highlights

Sequential CC growth of 5.6% led by Electric Powertrain and Autosar. During the last 4 quarters, offshoring has 01 increased and thus the volume growth is proportionately higher. Q3 was a good quarter in terms of deal closures.

EBITDA expansion of 86 bps post mid-term corrections, quarterly promotions and fresher addition. Improvement in 02 revenue mix with increase in fixed price projects and offshoring.

Sequential net profit growth mainly aided by higher 03 operating margins. Other income lower due to adverse currency movements.

04

High cash conversion continued post acquisition and variable incentive payouts, with DSO maintained at 48 days. Cash Balance at quarter end crosses ₹ 10 billion. 12[th] consecutive quarter of increase in net cash

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Additional facts - timeseries

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----- Start of picture text -----

Revenue $ M
[83.7]
[76.9] [76.9] 74.5 [77.2] [80.4]
72.8 [77.2]
71.1 65.3 65.3 [69.7]
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Qtr. End Net Cash ₹ B
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----- Start of picture text -----

[10.23]
[9.33]
8.22 [8.78]
5.28 [6.30]
[3.94]
[3.28]
0.90 [1.81] 2.04 [2.58]
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EBITDA %

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----- Start of picture text -----

17.2%17.3% [17.6%18.5%]
14.3% [15.7%]
14.6%13.4%13.4%13.5%13.4%
12.8%
EBITDA ₹ M
[1,150]
981 [1,041]
931
811
639 739 727 737 751 662 697
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EBITDA ₹ M

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Management Quotes

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Kishor Patil, CEO and MD, KPIT said,” The demand environment in the Mobility Industry continues to be robust, especially in the newer technology areas led by electrification, autonomous, connected and architecture changes. Our strategic clients have a medium-term roadmap of sustained investments in these areas, giving us a healthy growth visibility for the next 4-5 We are the within the to accelerate our years. forming right partnerships ecosystem journey towards achieving our Vision. The growth during the quarter was in line with our expectations and we continue to deliver on margin improvement and cash conversion relentlessly. As we enter the last quarter of the financial year, we are confident of delivering on the end of our revised outlook and the next on a higher yearly begin year strong footing.”

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Sachin Tikekar, President and Whole-time Director, KPIT said, ” Guided by our Vision, we carry on to work ceaselessly on our Mission, leaning on the four pillars of Strategic Clients, Platforms and Practices, Zero Defect Delivery and Best Place to Grow. In line with the industry, employee turnover has been higher during the last 3-4 months. We expect the same to stabilize over the coming quarters. We are focusing on internal growth paths for our people and aggressively hiring talent, including freshers. Our engagements with strategic clients are increasingly becoming more relevant and value accretive towards our clients’ transformation journey. We continue to invest towards strengthening our solutions and client facing organizations. With these, we are poised for sustainable growth in coming years”.

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Cash Flow – Major Movement

INR Million Decrease in Working Capital – 677

Capex – 294 PP acquisition - 555

Cash and Cash Equivalents break-up ₹ M In Investment Accounts (in India) 5,319 In Investment Accounts (outside India) 1,849 In Operating Accounts 3,058 TOTAL 10,226

	Q-o-Q Increase in Net Cash : INR 893 Million	Q-o-Q Increase in Net Cash : INR 893 Million	Q-o-Q Increase in Net Cash : INR 893 Million	Q-o-Q Increase in Net Cash : INR 893 Million
	NET CASH (INR Mln)		Q3FY22	Q2FY22
	Gross Cash		10,226	9,334
	Long Term Debt		NIL	NIL
	Short Term Debt		NIL	NIL
	NET CASH		10,226	9,334

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DSO Q3FY22 end : 48 Days

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New Partnership

KPIT, dSPACE, and Microsoft team up to offer a solution for homologation of autonomous vehicles

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• Data-driven simulation and homologation for the development of autonomous driving is a new field that demands expertise in various areas, including, DevOps, cloud computing, simulation, and automation

• • Benefit for the mobility ecosystem: accelerated development of autonomous driving development at optimized technology spend

• The companies combine excellence in areas of artificial intelligence, software, hardware, verification & validation, and cloud services

• The solution will accelerate and optimize the complete development process, from data collection and software development to integration and in-vehicle testing.

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New Engagements

Broad Based Engagements, across practices and geographies

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A American Truck Manufacturer selected KPIT for a leading strategic engagement in the Electric Powertrain domain

A American Car Manufacturer selected KPIT for a leading strategic program in the vehicle engineering domain

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A leading Asian Car Manufacturer selected KPIT for a program in the Autosar domain

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A leading American Tier I selected KPIT for multiple engagements in the Autonomous Driving domain

A leading European Tier I selected KPIT for a key engagement in the Body Electronics domain

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FY22 – Revenue and Profitability

REVENUE GROWTH

The revenue growth momentum will continue in the coming years. The growth is expected to be broad based across practices and clients. We have a healthy order book and decent medium-term visibility. We expect FY22 growth to be at the higher end of the 18% - 20% range

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Platforms
Zero
and
Defect
Practices
Delivery
Profitability
FY22
Best Place
to Grow
Revenue
Growth T25
Clients
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PROFITABILITY
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We had higher than normal wage hikes during the year and we will continue to invest in freshers & client facing initiatives. Offshoring, productivity improvement, employee pyramid and fixed cost leverage will continue to help us build on margins . We expect FY22 EBITDA to be ~18%.

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• 1 March 2021

Other Updates

Q3FY22

Reimagining Mobility withYOU

Recognition

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KPIT wins 'Transformation Initiative in Treasury Management' Award

KPIT is delighted and humbled to have won the 'Transformation Initiative in Treasury Management' Award in the 4th edition of the Financial Leadership Awards organized by Kamikaze B2B Media.

The award was conferred to Ms. Priya Hardikar, SVP & Head Corporate Finance Governance, KPIT, on behalf of KPIT virtually during the CFO Executive Leadership Summit 2021.

Financial Leadership Awards recognize leaders in all aspects of Financial, Treasury, Risk & Compliance management. We are thankful to Kamikaze B2B Media and the entire jury for successfully organizing this event and awarding us the prestigious award.

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PathPartner Integration

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PathPartner (PP) was fully integrated during the quarter. KPIT owns a controlling stake in PP and the full 100% acquisition is expected to be completed over the next couple of years.

The PP integration has progressed very well and certain KPIT influenced revenues are already a part of the revenues integrated from PP during the quarter. KPIT and PP teams are already working on joint deliveries to clients. 461 employees as at the end of the quarter are added from PP.

PP Operating margins are around 15% and we expect them to improve in the coming quarters.

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Thought Leadership Updates

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KPIT is proud to have been featured in NASSCOM’s ‘THE CLOUD CORNERSTONE: SUCCESS IN ACTION- Case Study Compendium 2021’. The compendium highlights how various verticals have leveraged cloud solutions to overcome business problems and provide value.

KPIT’s case study on AI/ML-based Prediction of the Remaining Useful Life (RUL) of a spark plug, based on a recent project for a European OEM, is a part of Volume I of the compendium.

The featured case study aptly illustrates the Cloud-based solutions offered by KPIT to its OEM and Tier-1 partners.

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KPIT is proud to be featured in the NASSCOM's 'ADVANTAGE INDIA: Gateway To Global Engineering R&D And Innovation' report. Prof. K. Vijayraghavan, Principal Scientific Advisor, Government of India, launched the report at the 13th edition of NASSCOM Design & Engineering Summit 2021. It features the following case studies from KPIT:

• Development of Advanced Driver Assistance Systems and Autonomous Driving technology

• • Software development and integration for Charger Control Unit

• This report is testimony to the achievements of the Indian Engineering R&D ecosystem that has led to India becoming a destination of choice for Engineering R&D.

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Thought Leadership Updates

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KPIT’s article in HANSERautomotive HANSERautomotive, a leading German Automotive magazine, recently published a technical article from KPIT titled 'Architecture of an integrated Park-in and Park-out system,'

The article discusses the system-level architecture of an Automated Park Assist System to aid the driver in maneuvering the vehicle in a predetermined accessed space for parking. This research includes but is not limited to ultrasonic and camera object data fusion, parking trajectory planning, and motion control

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KPIT's perspective in the IHS Markit’s Autology weekly podcast series

The KPIT podcast was titled ‘Will consumers be over the moon about over-the-air updates?’ - a part of IHS Markit’s Autology weekly podcast series.

Over-the-air (OTA) updates are set to become a foundational feature of today’s connected devices. With the amount of software per vehicle continuing to grow, Over-the-Air (OTA) updates can benefit all stakeholders- from vehicle manufacturers to the end consumers.

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• 1 March 2021

Financial & Operational Data

Snapshot

Reimagining Mobility withYOU

INR MN

Profit & Loss Account Snapshot

	DETAILS Q3FY22 Q2FY22 Q3FY21	DETAILS Q3FY22 Q2FY22 Q3FY21
	Revenue from Operations 6,223.67 5,908.73 5,172.45
	Other Income 80.75 89.37 64.09
	Total Income 6,304.42 5,998.10 5,236.54
	OperatingExpenses 5,073.92 4,868.14 4,343.13
	EBITDA 1,149.75 1,040.59 810.57
	Depreciation 311.57 290.93 337.72
	EBIT 838.18 749.66 472.85
	Finance Costs 44.83 38.56 39.83
	Change in FMV of Investments 4.75 21.39 2.88
	Profit Before Exceptional Items 878.85 821.86 518.74
	Exceptional items - - 19.45
	Share ofprofit/(loss) of equityaccounted investee (3.39) - -
	PBT 875.46 821.86 538.19
	Tax 172.37 170.86 108.45
	PAT 703.09 651.00 429.74
	Profit Attributable to owners of the company 700.10 651.00 417.73
	Profit Attributable to non-controllinginterest 2.99 - 12.01

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INR MN

Balance Sheet Snapshot

ASSETS	Q3FY22	Q2FY22
NON-CURRENT ASSETS
Property, Plant & Equipment	1,967.75	1,868.99
Right-of-use Assets	2,397.34	2,304.49
Other Tangible Assets	8.92	136.70
Goodwill & Other Intangibles	2,016.46	1,397.59
Other Non-Current Assets	1,243.00	1,137.22
TOTAL NON-CURRENT	7,633.47	6,844.99
CURRENT ASSETS
Inventories	NIL	NIL
Cash and Cash Equivalents	10,226.30	9,333.79
Trade Receivables	3,784.51	3,604.79
Other Current Assets	1,180.20	1,407.87
TOTAL CURRENT	15,191.01	14,346.45
TOTAL ASSETS	22,824.48	21,191.44

EQUITY & LIABILITIES	Q3FY22	Q2FY22
EquityShare Capital	2,698.64	2,696.18
Other Equity	10,768.99	10,042.32
Equityattributable to owners	13,467.63	12,738.50
Non-controllinginterests	134.83	-
TOTAL EQUITY	13,602.46	12,738.50
N ON-CURRENT LIABILITIES
Borrowings	NIL	NIL
Lease Liabilities	1,773.67	1,748.95
Other Non-Current Liabilities	810.19	772.38
TOTAL NON-CURRENT	2,583.86	2,521.33
CURRENT LIABILITIES
Borrowings	NIL	NIL
Trade Payables	1,545.19	1,508.18
Lease Liabilities	376.99	329.07
Others	4,715.98	4,094.36
TOTAL CURRENT	6,638.16	5,931.61
TOTAL EQUITY AND LIABILITIES	22,824.48	21,191.44

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USD MN

Revenue Break-up

Geography	Q3FY22	Q2FY22	Q3FY21	Q-o-Q	Y-o-Y
US	30.43	32.53	28.57	(6.5)%	6.5%
Europe	35.12	32.13	30.48	9.3%	15.2%
Asia	18.14	15.69	10.68	15.6%	69.8%
TOTAL	83.69	80.36	69.72	4.1%	20.0%

	Verticals	Q3FY22	Q2FY22	Q3FY21	Q-o-Q	Y-o-Y	Y-o-Y
	Passenger Cars	61.42	59.70	52.94	2.9%	16.0%
	Commercial Vehicles	20.40	19.66	15.81	3.8%	29.1%
	Others	1.87	0.99	0.97	89.3%	93.2%
	TOTAL	83.69	80.36	69.72	4.1%	20.0%
	Practices Powertrain	Q3FY22	Q2FY22	Q3FY21	Q-o-Q	Y-o-Y
		33.19	31.58	30.00	5.1%	10.7%
	AD-ADAS	14.47	14.45	13.34	0.1%	8.4%
	Connected Vehicle	8.17	8.41	6.76	(2.8)%	20.9%
	Others	27.85	25.92	19.62	7.5%	42%

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P&L Metrics

	Q3FY22	Q2FY22	Q3FY21	Q-o-Q	Y-o-Y
Revenue by Contract Type
Time & Material Basis	43.5%	43.7%	46.3%	3.6%	12.8%
Fixed Price Basis	56.5%	56.3%	53.7%	4.6%	26.2%
Clients
Strategic T21 Client Revenue	82.93%*	83.82%	85.27%	(1.0)%	12.1%
Active Clients	58	55	55
Revenue per Devp. Employee USD 46,365 51,910 49,456 EBITDA Margin 18.5% 17.6% 15.7% EBIT Margin 13.5% 12.7% 9.1% PAT Margin 11.2% 11.0% 8.1% Effective Tax Rate 19.7% 20.8% 20.2% EPS (Basic) 2.60 2.42 1.55 EPS (Diluted) 2.56 2.39 1.54
EBITDA Margin
EBIT Margin
PAT Margin
Effective Tax Rate
EPS (Basic)
EPS (Diluted)

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• Excluding PP revenues

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Currency wise revenues, Hedging Details

Currency wise revenue	Q3FY22	Q2FY22	Q3FY21
USD	37.8%	41.9%	42.0%
EUR	36.4%	34.0%	38.6%
GBP	5.0%	5.5%	4.5%
JPY	11.1%	10.4%	5.3%
INR	4.8%	4.4%	5.0%
Others	4.8%	3.8%	4.5%
Realized Rate Q3FY22 Q2FY22 Q3FY21
INR/USD 74.37 73.53 74.19

O/s Hedge Details	Q3FY22
Hedge Rates
USD/INR	77.21
EUR/INR	89.54
GBP/INR	105.57
Hedge Amounts(Mn)
USD/INR	37.70
EUR/INR	12.25
GBP/INR	4.68

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Headcount Data

Period End Headcount	Q3FY22	Q2FY22	Q3FY21	Q-o-Q	Y-o-Y
Development	7,220	6,192	5,639	-	-
Enabling & Sales	606	540	513	-	-
Total	7,826	6,732	6,152	-	-

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• 1 March 2021

Contact Us

Reimagining Mobility withYOU

Conference Call Details

Conference name : KPIT Technologies Q3 FY2022 Post Earnings Conference Call Date : Wednesday February 02, 2022 Time : 1600 Hrs. Participants : Mr. Kishor Patil, Co-founder, CEO & MD Mr. Sachin Tikekar, President & Board Member Mrs. Priya Hardikar, SVP & Head of Finance Mr. Sunil Phansalkar, Head-IR Dial-in Numbers for all participants Click here for your Diamond Pass 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 6,250+ 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

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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.

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