hares of KPIT Technologies slumped as much as 17 per cent to Rs 157.4 after the mid-tier IT company issued profit warning for the first quarter, citing “changes in business environment”.
“The company is going through internal changes in structure as well as external changes in the business environment. The company’s traditional revenues from ERP implementations are affected more than anticipated earlier, whereas there is good traction in the newer areas of cloud and digital technologies,” the Pune-based company said in a statement to the Bombay Stock Exchange.
As a result, KPIT Technologies said it expects a drop in “revenues of around 4 per cent in the first quarter, with a consequent drop in profitability.”
The company also expects “revenues and profits to be flattish in second quarter over first quarter levels.”
It has been a roller-coaster ride for KPIT Technologies shares in the past one year. The stock hit a 52-week low of Rs 89.75 on June 29, 2015. The company’s shares had taken a big beating after its fourth quarter earnings for the fiscal year FY15 had disappointed investors.
Concerns over the impact of Brexit on Indian outsourcers had weighed on KPIT shares as well in the past one month. The stock was also weighed down by a legal dispute with a former US-based client. Including today’s losses, the stock has fallen 12 per cent in the past one month against a 2 per cent gain in broader Nifty50 index.
At 11:15 a.m., shares of KPIT Technologies were down 12 per cent to Rs 162 as compared to a 0.80 per cent gain in Nifty50 index.