Persistent Systems shares zoom 10% after Q3 profit surges 30% YoY to Rs 373 crore

Persistent Systems' shares surged 10% in early trade to an intraday high of Rs 6,251.45 on the BSE on Thursday, January 23, after the company reported a 30.4% year-on-year (YoY) jump in net profit to Rs 373 crore for the third quarter ended December 31, 2024.
The impressive growth was driven by its AI-led, platform-driven services strategy, despite a seasonally weak quarter for the IT sector.

The company's consolidated revenue for Q3 grew 22.6% YoY to Rs 3,062.28 crore, marking a 5.7% sequential increase. Operating margins also improved by 90 basis points to 14.9%, after remaining flat at 14% for the previous two quarters.


Sandeep Kalra, Chief Executive Officer and Executive Director, Persistent said, “We recorded our 19th sequential quarter of revenue growth, with 4.3% Q-o-Q and 19.9% Y-o-Y increase — highlighting the strength of our AI-led, platform-driven services strategy. We also declared an interim dividend of Rs 20 per share.”

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Meanwhile, following the Q3 results, brokerage firm Nomura maintained a 'Neutral' rating on Persistent Systems with a target price of Rs 6,200.

The brokerage noted resilient growth driven by strong execution and highlighted that margin improvement adds further comfort. Deal wins have been decent, and the company's robust execution is expected to deliver industry-leading growth. Additionally, Persistent Systems has delivered on its promise of margin improvement, strengthening its position in the market.

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The company’s Board of Directors declared an interim dividend of Rs 20 per share on the face value of Rs 5 each for the Financial Year 2024-2025.

Order bookings for the quarter stood at $594.1 million in Total Contract Value (TCV) and $428.3 million in Annual Contract Value (ACV). These were driven by deals secured across key sectors, including BFSI, healthcare and life sciences, emerging industries, and software and hi-tech.

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