Persistent Systems Stock Skyrockets 10% On Q2 Performance; Brokerages Bullish

Persistent Systems' stock surged up to 10 per cent in the Wednesday trading session following the mid-tier IT services provider's strong results report for the September 2024 quarter.

Numerous brokerages also expressed interest in the robust financial performance, which resulted in positive projections and recommendations to buy.

Persistent System stock traded with more than 11 per cent gain at Rs 5,706 in the afternoon session on the National Stock Exchange (NSE).

“Persistent Systems has been able to maintain its resilience in a difficult market climate thanks to its distinctive value offer and emphasis on regulated sectors,” stated Prabhudas Lilladher.

Additionally, investments in developing a senior leadership team in crucial verticals have increased client engagement and made it easier to close big strategic deals, added the brokerage firm.

Persistent Systems declared that its net profit for Q2 FY25 increased by 23.4 per cent year-on-year (YoY) to Rs 325 crore. The IT company's operating revenue increased by 20.1 per cent to Rs 2,897 crore compared to Rs 2,412 crore in the same quarter last year. 

In the September quarter, Persistent earnings before interest, taxes, depreciation, and amortisation(EBITDA) increased to Rs 384 crore, with an EBIT margin of 14 per cent.

Another brokerage firm, Motilal Oswal emphasised Persistent Systems' remarkable 20.1 per cent YoY growth in spite of a slump in important industries. The company's competitive advantage in high-growth areas is demonstrated by the expansion of the healthcare and banking, financial services, and insurance (BFSI) verticals.

To adjust to changing market demands, the company is establishing itself as a platform-driven enterprise that uses AI solutions, said Motilal Oswal.

In terms of stock performance, Persistent System stock delivered more than 50 per cent return in the year 2024 so far compared to nearly 20 per cent return of the Nifty IT index.