Strong Q2 results caused Persistent Systems’ share price to surge by about 12% to reach all-time highs. The company’s overall net profit increased by 23.44% to ₹324.9 crore in the September quarter, up from ₹263.2 crore in the same period the previous year. Operating revenue for the quarter was ₹2,897.1 crore, up 20.13% from ₹2,411.6 crore in the September FY24 quarter.
Today’s opening price of ₹5,259.55 per share for Persistent Systems saw the stock reach an intraday high of ₹5,764 and a low of ₹5,200. The share price of Persistent Systems is on a strong upward trajectory, up over 10%, and has re-entered uncharted territory, according to Rajesh Bhosale, Equity Technical and Derivative Analyst at Angel One. They hold a positive bias and anticipate that this uptrend will continue. With 5,600 as the primary support and 6,100 as the barrier, traders should adopt a buy on dip strategy.
Additionally, Ruchit Jain, Lead Research Analyst at 5paisa, emphasised that the momentum is expected to continue because the upmove is being supported by excellent volumes. Long-term investors ought to keep following this pattern.
Check Out What Broker’s Say
ICICI Securities
The brokerage’s analysis states that Persistent Systems had a successful quarter overall: 1) revenue; 2) TCV for transactions; and 3) profit margins. Considering that FY25’s one-time gains were fuelled by the following levers: Investor concerns regarding the company’s ability to increase margins in FY26 can be allayed by 1) a slower rate of sales and marketing investments; 2) pricing and right shoring; and 3) a larger revenue share from higher-margin platform-based services.
“We continue to value the stock at 51x on Q2FY26E to Q1FY27E EPS of INR 121 to arrive at a target price of ₹6,140 with a potential upside of ~19%. We upgrade Persistent Systems to BUY (from Add) given the recent correction in its stock price. Persistent Systems remains our preferred pick given its ability to consistently deliver industry-leading growth despite a challenging demand environment,” the brokerage said.
Nuvama Institutional Equities
The broker claims that the company’s success in the second quarter surpassed their expectations. “Core” margins significantly recovered from Q1 levels, and Persistent delivered another quarter of strong growth. The broking still thinks that the company’s story is interesting and that the worries about margins are overblown.
“We are trimming FY25E/26E EPS by -2.5%/-3.2%, primarily on lower other income (EBIT largely intact). All in all, we continue to value PSYS at 50x Sep-26E PE, yielding a target price of ₹6,350 (earlier ₹6,500); retain ‘BUY’,” the brokerage said.
