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Last Updated : Sep 18, 2018 02:06 PM IST | Source: Moneycontrol.com

Hold Persistent Systems; target of Rs 850: JM Financial

JM Financial recommended hold rating on Persistent Systems with a target price of Rs 850 in its research report dated July 30, 2018.

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JM Financial's research report on Persistent Systems


Persistent (PSYS) reported a strong c.6% QoQ USD revenue growth in 1QFY19. However, the beat on our estimates (c.4%) was led by the recently launched direct IP sales. Excluding that, USD revenue growth (0.6% QoQ, JMFe) was uninspiring, especially after the soft 4QFY18. Thus, while we appreciate the addition of a new revenue stream, a weak trajectory in the core business is a concern. It also adds to the quarterly volatility in the business and increases its exposure to the IBM ecosystem.


Outlook


We have lowered our FY19/FY20 EPS estimates marginally (1.0%/0.1%) on slower growth in the core business; our PT moves to INR 850 (INR 830 earlier) on roll-forward. Maintain HOLD.


For all recommendations report, click here


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First Published on Aug 6, 2018 05:30 pm
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