“Persistent is one of the leading and the listed Indian player in the outsourced software product development (OPD) space and primarily caters to the large Independent Software Vendors (ISVs), Telecom and Enterprise clients, such as, Citi Bank, Wells Fargo, Samsung, Nokia and Motorola. The company has service offerings across the various stages of product lifecycle. Persistent designs, develops and maintains software systems and solutions, creates new applications and enhances the functionality of the existing software.”
“Based on our recent interaction with the management, we believe, though the overhang of macro-economic uncertainty on client spending still remains and the linear OPD business is under some pressure, the ISVs are investing in new technology areas to stand in competition and also gain new market share. Persistent’s niche presence and expertise in the software engineering space, marquee clientele and focused approach in new technological areas would help them to register better growth in tough times. Moreover, higher revenue contribution from the IP-led initiatives would aid better growth and higher margin profile in the medium to long term. We upgrade our EPS estimates for FY13E to accommodate higher IP contribution and INR depreciation against USD and consequently revise our recommendation upward to ACCUMULATE,” says Way2Wealth research report.
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