Persistent Systems Limited (PSL) beats estimates; Q4 witnessed strong deal

Persistent Systems Limited (PSL) beats estimates; Q4 witnessed strong deal

by admin- Friday, April 29th, 2022 04:26:00 PM

  • Persistent Systems Limited (PSL) beats estimates; Q4 witnessed strong deal TCVs, robust net headcount additions, and strong client mining; ACV remained strong at $943.1 million in FY2022.
  • Revenue growth would be supported by broad-based demand, robust deal intake, client mining, and incremental revenue from acquisitions. PSL is well positioned to once again deliver market-leading growth in FY2023.
  • Management remains confident of delivering sustainable margin in FY2023 on strong revenue growth, flattening pyramid, and gradual increase in realisation.
  • We retain Buy with a PT of Rs. 5,550, given strong revenue growth potential, robust ACV, and building growth avenues via tuck-in acquisitions.

Valuations (Consolidated)                                         Rs cr

Particulars FY2022 FY2023E FY2024E FY2025E
Revenues

5,710.7

7,438.8

8,950.5

10,364.3

 OPM (%)

16.8

17.0

17.8

18.0

 Net Profit

690.4

858.8

1,073.3

1,238.5

 EPS

90.3

112.4

140.4

162.1

 EV/EBIDTA

35.7

26.5

20.4

17.0

 ROE (%)

22.4

23.7

25.4

25.1

 ROCE (%)

26.0

26.1

28.8

29.1

 

Actual vs estimates

Quarter Ended

Q4FY22A

Q4FY22E

Var (%)

Revenues In USD (mn)

217.3

214.8

1.2

Revenues In INR (Cr)

1637.9

1617.2

1.3

Operating profit

281.2

269.5

4.3

EBIT

230.0

219.3

4.9

Net Profit

201.0

182.6

10.0

EPS (Rs)

26.3

23.9

10.1

 

OPM (%)

17.2

16.7

50

EBIT Margin (%)

14.0

13.6

48

NPM (%)

12.3

11.3

98

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