The share price of this large-cap firm surged 2.08 percent to an intraday high of ₹4,592.50 per share on Wednesday after the company acquired a US company named Starfish Associates for $ 20.7 million
Share Price Movement: With a market capitalization of ₹69,944.09 crores, the shares of Persistent Systems Limited surged by 2.08 percent, trading at ₹4,548.05 apiece during Wednesday’s morning session. The shares of this company generated an overall return of 88.25 percent over the past year and 25.59 percent over the past 6 months.
What happened: According to Persistent Systems Limited’s stock exchange filings, the company announced that it has acquired a U.S.-based company named Starfish Associates for a valuation of $20.7 million. Through this acquisition Persistent Systems ventures into the field of AI-driven contact centers and unified communications.
Out of the total $ 20.7 million Persistent will make an initial payment of $ 15.7 million to Starfish shareholders. The remaining $ 5.1 million will be paid over the next two years, contingent upon meeting specified performance targets, as detailed in the exchange filings.
Starfish Associates is in the business of unified communication contact centers and technology services. As of March 31, 2024. Starfish had an LTM (Last twelve months) revenue of $ 8.2 million. The acquisition is said to be completed within 4 to 6 weeks.
Why it matters: By combining Starfish Associates’ platform with Persistent’s AI technology, Persistent can offer better solutions that help businesses transform and improve their operations. This merger makes work processes more efficient and allows Persistent to quickly adapt to business needs. It also increases Persistent’s customer base and strengthens its market position.
Financials: Reviewing the financials of Persistent Systems Limited on a year-on-year basis, the revenues rose by 17.6 percent from ₹8,351 crores in FY23 to ₹9,822 crores in FY24. In the same time frame, the net profits increased from ₹921 crores to ₹1,093 crores, demonstrating an 18.6 percent increase.
For additional financial highlights, the EBIT surged by 13.4 percent from ₹1,247.2 crores in FY23 to ₹1,419 crores in FY24. Additionally, the PAT also grew by 18.7 percent from ₹921 crores to ₹1,093 crores during the same period.
As of FY24, Persistent’s revenue by geography was divided as follows: 79.6 percent from North America, 9.0 percent from Europe, 11.3 percent from India, and 1.7 percent from the rest of the world.
Ratios: In terms of return ratios for the year 2024, it has reported a return on equity (ROE) of 22.05 percent and a return on capital employed (ROCE) of 28.79 percent.
Shareholding Pattern: As of March 2024, the firm’s shareholding pattern stood at 31.02 percent for promoters, 18.14 percent for the public, 24.96 percent for foreign institutional investors, and 25.88 percent for domestic institutional investors.
About the Company: Incorporated in 1990, Persistent Systems provides software engineering and strategy services to help companies implement and modernize their businesses. Persistent Systems provides services in software product engineering, cloud and infrastructure, intelligent automation, data analytics, application development, and management, among others.
Written By Zahal
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