Persistent Systems shares jump over 6% after robust Q2 results; brokerages lift targets
Shares of Persistent Systems surged more than 6% to ₹5,688.7 in early trade on Wednesday after the IT firm reported stronger-than-expected September quarter (Q2 FY26) results. The rally followed several brokerages raising their target prices, citing broad-based growth and improved margins, though some warned that valuations remain high.
The company’s consolidated net profit rose 45% year-on-year to ₹471.4 crore, beating market estimates, while revenue grew 23.6% to ₹3,580.7 crore. Operating profit climbed 44% to ₹583.7 crore, lifting EBIT margin to 16.3%. Persistent reported a total contract value (TCV) of $609.2 million and an annual contract value (ACV) of $447.9 million for the quarter, News.Az reports, citing foreign media.
CLSA reiterated a bullish stance, maintaining a high-conviction “outperform” rating and raising its target price to ₹8,270, noting growth across revenue, margins, and cash flows. It expects a 29% EPS CAGR over FY25–27 and highlighted management’s reaffirmed $2 billion revenue target for FY27.
HSBC upgraded its target to ₹6,000 while keeping a “hold” rating, citing strong growth and profitability but warning that valuation limits further upside.
Nomura maintained a “neutral” call with a target of ₹5,200, acknowledging an “all-round performance” and improved margins from lower software-licence costs.
Persistent Systems currently trades at a P/E of about 58x with a dividend yield of 0.62%. Despite valuation concerns, analysts said the company’s strong order pipeline and margin expansion underscore continued growth momentum in FY26.
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