Persistent Systems plunges 16% on disappointing Q2 results

The stock plunged 16% to Rs 559, also its 52-week low on the BSE in early morning trade.

Shares of Persistent Systems hit a 52-week low, plunging 16% to Rs 559 per share on the BSE in early morning trade after the company reported a 4.3% quarter on quarter (Q-o-Q) decline in dollar revenue at $118.23 million in September quarter (Q2FY19).

Analysts had expected Persistent USD revenues to decline less than 1% QoQ led by softer growth in Digital SBU led by slower off take in Appian as well as sequential weakness in IBM alliance business.

In rupee terms, revenue during the quarter under review grew 0.2% Q-o-Q at Rs 8,356 million, while net profit up 0.9% at Rs 881 million over the previous quarter. EBITDA (earnings before interest, tax, depreciation, and amortization) margin improved to 17.2% from 16.78% in June quarter.

“The shortfall in digital revenue can be attributed to short closure of one of our projects and a shift in the business mix as some projects moved offshore,” Persistent Systems said in a press release.

At 09:41 am; the stock was trading 13% lower at Rs 574 on the BSE, as compared to 0.34% decline in the S&P BSE Sensex. A combined 417,199 equity shares changed hands on the counter on the NSE and BSE.