⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
PERSISTENT - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.8
| Stock Code | PERSISTENT | Market Cap | 74,134 Cr. | Current Price | 4,700 ₹ | High / Low | 6,599 ₹ |
| Stock P/E | 47.1 | Book Value | 420 ₹ | Dividend Yield | 0.74 % | ROCE | 28.4 % |
| ROE | 20.9 % | Face Value | 5.00 ₹ | DMA 50 | 5,344 ₹ | DMA 200 | 5,633 ₹ |
| Chg in FII Hold | 1.55 % | Chg in DII Hold | -0.80 % | PAT Qtr | 452 Cr. | PAT Prev Qtr | 459 Cr. |
| RSI | 35.8 | MACD | -267 | Volume | 7,98,072 | Avg Vol 1Wk | 6,02,694 |
| Low price | 4,149 ₹ | High price | 6,599 ₹ | PEG Ratio | 2.42 | Debt to equity | 0.05 |
| 52w Index | 22.5 % | Qtr Profit Var | 38.7 % | EPS | 96.4 ₹ | Industry PE | 20.9 |
📊 Financial Overview
- Revenue & Profitability: Quarterly PAT at ₹452 Cr. vs ₹459 Cr. shows slight decline, but overall profitability remains strong. ROE (20.9%) and ROCE (28.4%) highlight efficient capital use.
- Debt & Liquidity: Debt-to-equity at 0.05 indicates negligible leverage, ensuring financial stability and healthy cash flows.
- Valuation: P/E of 47.1 is significantly higher than industry average (20.9), suggesting overvaluation. P/B ~11.2 indicates premium pricing. PEG ratio (2.42) reflects expensive growth expectations.
- Technical Indicators: RSI at 35.8 indicates oversold conditions; MACD at -267 signals bearish trend. Current price ₹4,700 is below DMA 50 (₹5,344) and DMA 200 (₹5,633), showing weakness.
🏢 Business Model & Competitive Advantage
- Persistent Systems operates in IT services, focusing on digital transformation, cloud, AI, and product engineering.
- Competitive advantage lies in strong client relationships, niche expertise in software engineering, and global delivery capabilities.
💡 Entry Zone Recommendation
- Entry zone: ₹4,500–₹4,800, near support levels.
- Attractive for long-term investors given strong fundamentals, but caution advised due to high valuation and bearish technicals.
📈 Long-Term Holding Guidance
- Suitable for long-term holding due to strong ROE/ROCE and sector growth potential.
- Upside potential tied to digital transformation demand, AI adoption, and enterprise cloud migration.
✅ Positive
- Strong ROE (20.9%) and ROCE (28.4%).
- Low debt-to-equity ratio (0.05).
- Quarterly PAT remains stable despite slight decline.
- FII holdings increased (+1.55%).
⚠️ Limitation
- High P/E (47.1) compared to industry average (20.9).
- P/B ratio (~11.2) indicates expensive valuation.
- Stock trading below DMA 50 and DMA 200, showing bearish trend.
📉 Company Negative News
- Quarterly PAT declined slightly from ₹459 Cr. to ₹452 Cr.
- Bearish technical indicators (MACD negative, RSI oversold).
- DII holdings reduced (-0.80%).
📈 Company Positive News
- FII holdings increased (+1.55%).
- Strong efficiency metrics (ROE/ROCE).
- 52-week index gain of 22.5% shows investor confidence.
🏭 Industry
- IT services industry P/E at 20.9, much lower than Persistent’s valuation.
- Sector growth driven by digital transformation, AI, and cloud adoption globally.
🔎 Conclusion
- Persistent Systems is fundamentally strong with high efficiency and low debt but trades at expensive valuations and shows bearish technicals.
- Entry near ₹4,500–₹4,800 is attractive for long-term investors; recommended as a cautious holding with strong sector tailwinds.