However, investors were more focused on the cautionary signals in the broader business commentary. While the deal pipeline remains strong, KPIT noted that conversions are slower than anticipated. Although Europe is showing signs of recovery, the US and Asia are still facing uncertainties, and the pace of ramp-ups has been even more sluggish than previously expected. Some new business wins are also partially cannibalizing existing revenues due to tight client budgets and a shift in spending priorities.

Adding to investor concerns, KPIT indicated that it does not expect any one-time gains in Q1 FY26 like it saw in Q4 FY25. The company also flagged potential pressure on other income due to recent forex fluctuations, further dampening the near-term outlook.

Despite the long-term strategic benefits of the Caresoft acquisition, the mid-quarter update appears to have triggered a reality check for the market. Slower execution, deal ramp-up delays, and muted Q1 guidance have collectively contributed to the stock’s sharp decline, as investors reassess the near-term earnings visibility.

KPIT Technologies is a global software development and integration partner for the automotive and mobility industry, focused on enabling software-defined vehicles. The company specializes in embedded software, AI, and digital solutions, supporting clients in adopting next-generation mobility technologies.

On a consolidated basis, the company's net profit surged 48.91% to Rs 244.73 crore on 15.98% increase in net sales to Rs 1,528.34 crore in Q4 March 2025 over Q4 March 2024.