Persistent Systems Limited

Persistent Systems Limited - Q3 FY21 Review

Persistent Systems Limited reported a net turnover of Rs 1,351 crore for the quarter ended Sept 30, 2021, when compared to Rs 1,007 crore for the quarter ended Sept 30, 2020. EBIT and Profit After Tax was Rs 224 crore and Rs 161 crore for the quarter ended Sept 30, 2021, as compared to Rs 166 crore and Rs 102 crore during the corresponding quarter of the previous year.

Persistent Systems Limited - Investment Summary

Persistent Systems Limited - Overview

• 30+ years of leadership - software engineering & digital transformation

• Highest customer experience scores in IT industry, rated by ISG

• Strong presence in North America

• Strong revenue growth of 9% QoQ for two consecutive quarters

• Strong headcount addition of 47% YoY

• Acquisition of SCI & Shree Partners to improve competitive abilities

Persistent Systems Limited - Quarterly Summary

Business

Persistent Systems Limited is a global technology company with specialization in software products services and technology information. The company offers services across all the stages of the product life cycle, which enables the company to have customers over a wide range. The customer base of the company enables it to develop, enhance and deploy the software products. Persistent Systems’ existence dates back to 1990 and in the three decades of its existence, it has spread its services across industries like BFSI, Healthcare, Telecom & Media, Industrial, and Software & Hi-Tech. The company has its offices across the world, in 18 countries and has customers spread across North America, Europe and Asia.

Over the last three decades, Persistent Systems Limited forged relationships with its customers to develop products across all aspects of the product life cycle. The company provides customers product engineering services and joint product development with revenue–share models. This allows the company to focus on the business of software and enterprises that are becoming software-driven. The company’s core strength lies in software engineering and R&D. Persistent Systems helps its customers in building next-gen products using its core strength.

Persistent Systems represents the operating segments from three industry lines. The industry lines are Banking, Financial Services and Insurance (BFSI), Healthcare and Life Sciences and Technology Companies and Emerging Technologies. The industry line BFSI of the company realized segmental revenue of around Rs 1,285.7 crore in FY21, contributing 30.7% towards the total revenue of the company. In FY20, this industry line brought in a revenue of Rs 1,050.6 crore, contributing 29.46% towards the total revenue. BFSI industry line saw a growth of 22.37% in FY21 over the last year. The segmental operating revenue from BFSI also increased by 33.91% when compared to the last year.

Segmental revenue from the industry line Healthcare & Lifesciences was around Rs 810.4 crore in FY21, contributing 19.35% towards the total revenue of the company. In FY20, this industry line brought in a revenue of Rs 671.2 crore, contributing 18.82% towards the total revenue. Healthcare & Lifesciences industry line saw a growth of 20.61% in FY21 over the last year. The segmental operating revenue from Healthcare & Lifesciences also increased by 37.32% when compared to the last year. Segmental revenue from Technology Companies and Emerging Technologies was around Rs 2,091.74 crore in FY21, contributing 49.95% towards the total revenue of the company. In FY20, this industry line brought in a revenue of Rs 1,843.2 crore, contributing 51.7% towards the total revenue. This line saw a growth of 13.48% in FY21 over the last year. The segmental operating revenue from Healthcare & Lifesciences also increased by 0.49% when compared to the last year.

In September 2021, the company announced its plans to acquire two companies – North Carolina based Software Corporation International (SCI) and New Jersey based Shree Partners, along with their respective subsidiaries. SCI’s acquisition is expected to enhance the company’s existing capabilities and to form the foundation for the company’s dedicated payments business unit announced in September 2021. Shree Partners’ capabilities in digital transformations and technology solutions expand the company’s cloud and IT infrastructure capabilities in BFSI and Travel & Hospitality and also increase its presence in North Carolina and NCR, Delhi.

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