A leading IT company saw its shares climb nearly 4 percent after reporting a strong 26 percent year-on-year surge in net profit for the March quarter. The rally was further supported by the company’s optimistic guidance for FY26, signaling continued growth momentum in the coming financial year.
Price Movement
During Thursday’s trading session, Persistent Systems Ltd reached an intra-day high of Rs.5,387.50 per share, rising 4.33 percent from its previous close of Rs.5,163.50 each. The shares have retreated since then and currently at Rs.5,298.00 apiece. Over the past five years, the stock has delivered over 2,160 percent returns.
Financial Performance
Persistent Systems Ltd saw a notable upswing in its stock price, driven by strong growth in both revenue and net profit, as reflected in its latest financial performance.
In Q4 FY25, the company reported revenue of Rs.3,242 crore, marking a 37 percent increase from Rs.2,591 crore in Q4 FY24. On a quarterly basis, revenue surged 17 percent from Rs.3,062 crore in Q3 FY25, highlighting steady business expansion.
Net profit for the quarter witnessed a 36 percent year-on-year rise to Rs.396 crore, compared to Rs.315 crore in the similar quarter of previous year. Additionally, on a quarterly basis, net profit saw a 27percent jump from Rs.373 crore in Q3 FY25, demonstrating robust earnings growth.
At present, Persistent Systems Ltd is trading at a Price-to-Earnings ratio of 60.97, higher than industry average of 35.36, indicating a relatively higher valuation. In terms of return metrics, the company’s Return on Capital Employed (ROCE) stands at 27 percent, while its Return on Equity (ROE) is 22.16 percent, reflecting its financial efficiency.
CAGR Growth
Since its IPO, the company has delivered a robust revenue CAGR of 17.4 percent up to FY25, reflecting consistent growth over the years. Notably, between FY21 and FY25, the company achieved an even stronger revenue CAGR of 25.6 percent, showcasing its accelerating business momentum and operational efficiency during this period.
Guidance and Dividend
Persistent Systems Ltd has set an ambitious target of reaching $2 billion in annual revenue by FY2027, reflecting its strong growth outlook and strategic focus. Along with its optimistic guidance, the company has declared a final dividend of Rs.15 per share, reflecting a 300 percent payout ratio. This move highlights its continued focus on rewarding shareholders and maintaining strong value distribution.
Developments in AI
The company is transitioning to an AI-led, platform-driven services model, focusing on automation, efficiency, and delivery speed. Key developments include AI-powered engineering platforms, enhanced testing automation, and expanded digital governance capabilities. The strategy also involves ecosystem collaboration to co-develop technology-specific solutions and scale operations across data, cloud, and product engineering domains.
Reputed Clientele
The company boasts a strong client portfolio, serving prominent global players such as Microsoft, Google Cloud, AWS, Salesforce, and IBM, reflecting its credibility and deep-rooted presence in the enterprise technology space.
Written by – Siddesh S Raskar
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