Persistent Systems: Analysts Recommend Buy with Target Price of Rs 6461

Persistent Systems Posts Robust Quarter with 3.4% Q/Q CC Revenue Growth

Persistent Systems, a leading provider of digital transformation, software, and engineering services, has reported robust results for the quarter, with a 3.4% quarter-over-quarter (q/q) compound annual growth rate (cc) revenue growth to $436 million. This growth is attributed to a healthy order book, with a long-term trailing compound annual growth rate (TCV) up 14.4% year-over-year (y/y). The company's large-account mining and resilient growth across major client buckets have also contributed to its success, with all customer buckets growing at roughly 19% to 21% year-over-year in FY26.

The company's medium-term ambition of achieving a $2 billion exit revenue run-rate by FY27 remains on track, with an implied compound quarterly growth rate (CQGR) of 3.5%. Additionally, Persistent aims to reach $5 billion by FY31, driven by its AI-led, platform-driven execution. In terms of vertical growth, the Life Sciences segment (~26% mix) led the way with 7% quarter-over-quarter (q/q) USD growth, while the North America region (~81% mix) saw 3.1% q/q growth.

Persistent has continued to emphasize its deep domain expertise playbook, which is anchored in its top accounts (~83% of revenue from Top 100; up ~20% y/y). The company has also strengthened its execution and increasing relevance in larger transformation programs against incumbents.

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Vertical and Regional Growth Comparison

Outlook and Recommendation

Based on the company's robust performance, we retain our BUY rating on the stock with a target price (TP) of Rs6,461, which represents a 21% upside from the current market price.

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