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Midcap IT company Persistent Systems posted 12.4 per cent year-on-year growth in profit at Rs 82.6 crore over Rs 73 crore a year ago, in line with street estimates. The company also recorded 8.1 per cent revenue growth at Rs 761 crore up from Rs 704 crore in Q2 last year, driven by higher digital services revenue.
“We are pleased with our performance this quarter; we have seen continued and steady growth in our revenues supported by improved margins. We see strong demand in data, digital and IoT, specifically in healthcare and financial services. Our methodology, Software 4.0 is helping our customers accelerate their journey towards becoming a software driven business,” said Dr Anand Deshpande, Chairman and MD Persistent Systems.
In USD terms, revenue growth reached $118 million growing 12.3 per cent quarter-on-quarter, again in line with estimates.
“Revenues at $118.1 million were up 4.5 per cent QoQ (3.4 per cent organic growth and rest owing to the two-month consolidation of PARX acquisition). Revenues were in line with our estimates led by traction in Digital SBU.
EBIDTA margin at 15.2 per cent was up 90bps QoQ and below our estimates at 15.5 per cent. Quantum of margin expansion was below my estimates,” Said Madhu Babu, Research analyst at PL India.
Large BFS and data analytics projects from the United States and healthcare projects have driven growth in this quarter. Revenue growth over the previous quarter stood at 4.6 per cent and profits grew a little over 10 per cent over the quarter. EBIDTA touched Rs 115.7 crore which is higher than Bloomberg’s estimate of Rs 114.4 crore.
PL India further noted that the company reduced headcount by 155 persons over the quarter and also that there has been a reduction in headcount over the year. Persistent Systems, like many other Indian IT companies, has been plagued by allegations of layoff over the past few months.