Neutral KFin Technologies: Target Price Raised to Rs 1000 by Motilal Oswal

KFin Technologies' Revenue Growth Slows Down in 4QFY26

KFin Technologies, a leading provider of technology services, has reported a slowdown in revenue growth in the fourth quarter of fiscal year 2026 (4QFY26). According to a research report by Motilal Oswal, the company's revenue declined 6% quarter-on-quarter (QoQ) to INR3.5 billion in 4QFY26, despite a 23% year-on-year (YoY) growth in the Ascent business added from the third quarter of fiscal year 2026 (3QFY26).

For the full fiscal year 2026 (FY26), KFin's revenue grew 21% YoY to INR13.2 billion. However, the company's operating expenses (opex) grew 36% YoY to INR2.2 billion, with employee expenses and other expenses increasing 49% YoY and 14% YoY, respectively. Employee expenses were particularly impacted by the introduction of the labor code, which added INR40 million to opex.

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KFin's Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) grew 5% YoY but declined 15% QoQ to INR1.3 billion, with EBITDA margins decreasing to 37% from 43.2% in 4QFY25.

Outlook and Recommendations

Motilal Oswal expects KFin's revenue, EBITDA, and Profit After Tax (PAT) to grow at a Compound Annual Growth Rate (CAGR) of 20%, 19%, and 16%, respectively, over the period of FY26-FY28. The research firm has maintained a Neutral rating on the stock with a one-year target price of INR 1,000, based on a 36x FY28 earnings per share (EPS) multiple.