Hold Persistent System; target of Rs 697: Arihant Capital

Arihant Capital's research report on Persistent System

Persistent Systems came out with weak set of numbers in Q4FY19. The company missed our estimates on all fronts as Revenue, EBITDA and PAT all came below our estimate. Revenue in rupee terms grew 10.5% YoY to Rs 8319 mn against our estimate of Rs 8590 mn. EBITDA stood at Rs 1266 mn against our estimate of Rs 1470 mn. PAT for the quarter stood at Rs 845 mn below our estimate of Rs 930 mn. Management in its concall acknowledged the fact that poor performance was owing to company specific issues rather than industry headwinds.

Outlook

We are cautious on the stock from near term perspective, and downgrade our rating from Accumulate to Hold with revised TP of Rs 697.

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