Persistent Systems share price crashes over 9% after Q1 results; is it a stock to buy?

Persistent Systems share price crashed over 9 per cent in intraday trade on the BSE on Thursday, July 24, a day after the company reported its Q1 results. Persistent Systems shares opened at ₹5541.50 against their previous close of ₹5605.35 and plunged 9.3 per cent to an intraday low of ₹5,084.15. Around 11:30 AM, the IT stock traded 8.14 per cent down at ₹5,149.25.

Persistent Systems Q1 results

After market hours on Wednesday, July 23, Persistent Systems said its Q1 consolidated profit after tax (PAT) rose 38.7 per cent year-on-year (YoY) and 7.4 per cent quarter-on-quarter (QoQ) to ₹424.94 crore.

Revenue for the quarter increased by 21.8 per cent YoY and 2.8 per cent QoQ to ₹3,333.59 crore. In constant currency (CC), revenue increased by 19 per cent YoY and 3.3 per cent QoQ.

EBIT for the quarter rose by 34.8 per cent YoY and 2.5 per cent QoQ to ₹517.81 crore. EBIT margin stood at 15.5 per cent against 14 per cent YoY.

The order booking for the quarter was $520.8 million in total contract value (TCV) and $385.3 million in annual contract value (ACV).

Persistent Systems: Is it a stock to buy?

The share price of Persistent Systems has crashed about 20 per cent this year, against a 5 per cent rise in the equity benchmark Sensex.

On a monthly scale, the stock has declined nearly 15 per cent in July, looking set to snap its two-month winning run.

Over the last year, Persistent's shares have gained 7 per cent, hitting a 52-week low of ₹4,163.80 on April 7 this year after hitting a 52-week high of ₹6,788.80 on December 20 last year.

After the company's Q1 show, experts have mixed views on Persistent Systems stock. Some have maintained their buy recommendations, while others appear to be cautious.

Brokerage firm Motilal Oswal Financial Services has maintained a buy call on the stock with a target price of ₹6,800, implying a 21 per cent upside potential.

The brokerage firm expects Persistent Systems' revenue, EBIT, and PAT to grow 20.8 per cent, 35.3 per cent, and 36.9 per cent YoY, respectively, in Q2FY26.

"We value Persistent at 48 times FY27E EPS. Given its consistent execution and visibility on growth, we value Persistent at 48 times FY27E EPS," said Motilal.

Brokerage firm JM Financial has also maintained a buy call on the stock, but trimmed the target price slightly to ₹6,720 from ₹6,770.

"Out of prudence, we have revised our FY26E and FY27E dollar revenue growth estimates downward to 16 per cent for both years, from the earlier projections of 18 per cent and 17 per cent, respectively. This results in a modest 0–2 per cent cut in EPS estimates. Given Persistent is trading at 42 times FY27E earnings, there is limited room for disappointment," said JM Financial.

On the other hand, ICICI Securities has maintained a "reduce" view on the stock with a target price of ₹5,130, given its rich valuations.

On the other hand, some technical experts appear to be slightly cautious.

According to Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers, Persistent Systems has breached the neckline of a head-and-shoulders pattern, as observed on the technical charts, following a strong 50 per cent rally since April 2025.

Patel said this breakdown indicates a potential trend reversal, with the pattern suggesting a downside target around the ₹4,800 level.

"Analysts recommend exercising caution and advise against initiating fresh long positions at this stage. Instead, traders may consider accumulating near the ₹4,800 support zone, should the stock stabilise around those levels," said Patel.

Read all market-related news here

Read more stories by Nishant Kumar

Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.