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The shares of Pune-headquartered Persistent Systems fell 9.7 per cent on Monday to Rs 3,510.6 a share, a day after the firm reported margin growth of 14.5 per cent in the quarter ended March 31, 2024 (Q4FY24), down from 15.4 per cent in the fourth quarter of FY23. The company said its margins were impacted due to ramp ups in large vendor consolidation deals, higher onboarding of lateral employees, and elevated travel costs that impacted margins by 200 basis points.
The firm's net profit grew 25.4 per cent to Rs 315.3 crore in Q4.
Its revenue was up 14.9 per cent at Rs 2,590.5 crore, beating Bloomberg estimates of Rs 2,562.9 crore, driven by growth across sectors such as lifescience and health care; banking, financial services and insurance (BFSI) and software; and hitech and emerging industries. Its profit also beat estimates.
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The total contract value for the fourth quarter came in at $447.7 million, down from the previous quarter's $475 million.
For the full year, the company’s revenue at Rs 8,350.5 crore grew 17.6 per cent, and profit was up 18.7 per cent at Rs 921 crore.
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During the analyst call, Sandeep Kalra, chief executive officer (CEO) and executive director, Persistent Systems, said: “We have delivered 14.5 per cent revenue growth (US dollars) for the full year, when the industry average is around 3-4 per cent. FY24 has been a complete organic growth story for the company.”
Unlike its large peers, Persistent reported growth in North America, as well as the BFSI sector. North America grew by 16.8 per cent year-on-year (Y-o-Y), Europe was up 13.4 per cent and India grew by 0.6 per cent. Similarly, BFSI grew 2 per cent sequentially, life science and health care was up 15 per cent Q-o-Q. Software, hitech and emerging business was down 0.9 per cent due to ramp down by one client.
On FY25 growth, the company management said that it would be similar to FY24.
“This is the 16th straight quarter of revenue growth for us. For FY25, our focus will be on growth,” said Kalra.
The headcount at the end of Q4FY24 was 23,850 and the company had a net new hire of 514.
