Persistent Systems Q4 Results Review - Inline; Resilient Outlook To Aid Growth: Axis Securities

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Axis Securities Report.In Q4 FY24, Persistent Systems Ltd. reported revenue of Rs 2,590 crore, up 3.4% QoQ and 3.0% QoQ (in constant currency terms). Reported revenue stood in line with our expectations. The company reported operating profits of Rs 454 crore, posting a growth of 2.8% on a QoQ basis. Much in line with our expectations, the company’s operating margins decline marginally by 20 bps to 17.5%. The company’s net profit for Q4 FY24 stood at Rs 315.3 crore, registering a growth of 10.2% QoQ. .Outlook From a long-term perspective, we believe Persistent is well-placed for encouraging growth, given its multiple long-term contracts with the world’s leading brands. Its improved revenue visibility gives us confidence in its business growth moving forward. However, rising concerns over the prospects of large economies along with prevailing supply-side constraints pose uncertainties over the company’s short-term growth rates..Valuation & Recommendation We assign a 35 times price/earnings multiple to its FY26E earnings of Rs 125.8/share to arrive at a target price of Rs 4,350/share, implying an upside of 24% from the current market price. Hence, we recommend a Buy rating on the stock..Key risks to our estimates and target priceThe demand environment is uncertain because of the potential threat of the recession from the world’s largest economies.The rising subcontracting cost and cross-currency headwinds may impact the company’s operating margins negatively..Click on the attachment to read the full report:.Persistent Systems Q4 Review - Inline Revenue Aided By Healthcare, Lifescience Vertical: HDFC Securities.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Persistent Systems Q4 Results Review - Inline; Resilient Outlook To Aid Growth: Axis Securities

Strong revenue growth momentum will continue backed by robust deal wins and strong addition of capabilities.

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