Persistent Systems Shares Drop 5% Following Q4 Earnings Report
Persistent Systems shares fall 5% on Q4 margin miss, slowing growth
Business Standard
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Persistent Systems shares fell by 4.7% to ₹5,080.4 after the company reported Q4FY26 results, revealing a profit increase of 33.7% year-on-year but a margin miss. Analysts expressed mixed views, with some lowering targets and others maintaining a buy rating amid concerns over slowing revenue growth.
- 01Persistent Systems shares dropped 4.7% following Q4FY26 results.
- 02Profit grew 33.7% year-on-year to ₹529.2 crore, but margins missed expectations.
- 03Revenue increased 25% year-on-year, but growth is slowing.
- 04Brokerages have mixed ratings, with Nomura cutting targets and Motilal Oswal raising theirs.
- 05The company's Ebit margin fell to 16.3%, down 40 basis points quarter-on-quarter.
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Persistent Systems' shares fell 4.7% on the Bombay Stock Exchange (BSE) after the release of its Q4FY26 results, hitting an intra-day low of ₹5,080.4 per share. The company reported a profit increase of 33.7% year-on-year to ₹529.2 crore, compared to ₹395.7 crore in Q4FY25. However, revenue growth showed signs of slowing, with a 25% year-on-year increase to ₹4,055.9 crore, and a sequential growth of 7.3%. The Ebit margin for the quarter was 16.3%, missing estimates by 40 basis points. Analysts have mixed views on the stock; Nomura maintained a neutral stance and cut its target from ₹5,300 to ₹5,200, citing missed expectations on revenue growth and margins. Conversely, Motilal Oswal raised its target from ₹5,650 to ₹6,200, highlighting Persistent's strong growth profile despite a deceleration in revenue. The company also declared a final dividend of ₹18 per share, which may provide some support to investor sentiment.
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The drop in share price may affect investor confidence and could impact the company's ability to attract future investments, potentially influencing job stability and growth initiatives.
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