KPIT Tech: Will see higher increments, promotions, increase in hiring in FY22

KPIT Tech has posted good fourth-quarter results, which came in above street estimates. The IT company has now seen two quarters of strong revenue growth and three-quarters of margin expansion.

Speaking with CNBC-TV18, Kishor Patil, Co-founder, Managing Director, and CEO at KPIT Technologies said, “Year-on-year (YoY) our EBITDA expansion if you look at in absolute number it was Rs 75 crore last Q4 and now it is Rs 93 crore so it is a substantial almost 20 percent increase in the EBITDA number in absolute term over last year Q4.”

On growth, he said, “Going forward for the next year we are very comfortable with the pipeline with have, comfortable with the business outlook. At this point in time, we are just saying double-digit growth, we have always delivered much better growth in the past. We are confident about the business environment and we will guide we go forward.”

On margins, he said, “We are exiting by about 17.2 percent, still we have said that we will have a margin between 16-17 percent EBITDA for the next year. We will have higher increments, promotions, in support of the growth, we will hire more. We also believe that in the second half of the year the operations will come to normal so some operational expenses will go up. So with all this, we will be spending higher. So in view of that, we have said it will be between 16 and 17 percent.”

On attrition, Patil said, “Year before we had one of the best numbers in terms of attrition, last year it remained similarly but because of the environment our attrition has gone up and we had expected that. We expect that attrition to be higher in the H1, but we certainly know that attrition will go down in H2. Over the year we are expecting about mid-teens.”

On engineering spends, he said, “If you take a view till year 25, many new technology production programs will be in 2025 which drives a lot of engineering spends. Roughly if you look at it the spending will go anywhere between 10-12 percent every year on the engineering.”