Persistent Systems Q3 net jumps 37 pc on higher revenue

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Updated: February 01, 2021 11:38 AM

Its overall revenues stood at Rs 1,075 crore, 6.7 per cent up from the preceding quarter and 16.5 per cent higher when compared to the year-ago period.

persistentIn a first, the company disclosed its total contract value (TCV) of deals for a period, and said that the number stood at USD 302 million, which is the highest in five quarters.

Mid-tier information technology company Persistent Systems has reported a 37.5 per cent jump in its December quarter net profit to Rs 120.9 crore on revenue growth from new deals.

The Pune-headquartered company had posted a net profit of Rs 87.9 crore in the year-ago period and Rs 101.9 crore for the preceding September quarter. Its overall revenues stood at Rs 1,075 crore, 6.7 per cent up from the preceding quarter and 16.5 per cent higher when compared to the year-ago period.

Its chief executive officer and executive director Sandeep Kalra told PTI that the revenues grew largely on the back of new deals signed in the last two or three quarters, during the pandemic period. He said usually deals are for over three to five year period, and the company is optimistic about maintaining the same momentum for more quarters as well.

In a first, the company disclosed its total contract value (TCV) of deals for a period, and said that the number stood at USD 302 million, which is the highest in five quarters. The profits grew on the back of operating margin expansion to 17 per cent during the quarter as against 16.4 per cent in the preceding quarter, despite new hiring and also effecting salary hikes from November 2020, he said.

Its chief financial officer Sunil Sapre said the margins could be widened on the sustained revenue momentum, cost optimisation and also as the COVID-related discounts offered to clients waned away. There is no pressure on margins while signing new deals, Kalra said, adding that the priority for the company will be to grow the revenue without compromising on the profitability.

The company hired 1,618 employees on a net basis during the reporting quarter, taking the overall headcount to over 12,438. Sapre said that 600 of the new hires are freshers and the hiring also includes people taken on board foreseeing future demand.

Kalra said the company will go back to regular salary hikes from July this year onwards, with the stability in revenue.

The company had net cash of USD 258 million as of December and will be looking opportunistically at acquisitions, but there is no deal in the works immediately. The company scrip was trading 0.72 per cent up at Rs 1,510.15 apiece on the BSE at 1244 hrs on Friday, as against a 0.09 per cent correction in the benchmark.

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