Persistent Systems fair value — is it overvalued?
The fair value of Persistent Systems (PERSISTENT), built from its filed accounts — ten years of results, the method that fits this business, and what today's price already assumes.
The market expects much less from Persistent Systems than it has delivered before.
At today’s share price, buyers are assuming Persistent Systems grows about 14% a year, forever. Over the last ten years it actually grew about 23% a year. That is a big step down from its own record. Either the market can see a problem that the published accounts do not show yet, or it is expecting a slowdown that has not happened.
What the market is assuming
Worked backwards from today's share price: the growth today’s price implies for Persistent Systems, against what the model assumes.
How to read this. The number on the left is the growth today’s share price quietly takes for granted. The number on the right is what the model actually assumes. When the two are far apart, that gap is the bet you would be taking.
Ten years, in charts
Revenue and earnings per share in ₹, return on equity and leverage as ratios — all from the filed statements.
The numbers behind them
Revenue and net profit as filed, in ₹ crore.
| Year | Revenue | Net profit | Margin |
|---|---|---|---|
| FY2019 | 3,366 | 352 | 10.4% |
| FY2020 | 3,566 | 340 | 9.5% |
| FY2021 | 4,188 | 451 | 10.8% |
| FY2022 | 5,711 | 690 | 12.1% |
| FY2023 | 8,351 | 921 | 11.0% |
| FY2024 | 9,822 | 1,093 | 11.1% |
| FY2025 | 11,939 | 1,400 | 11.7% |
| FY2026 | 14,748 | 1,865 | 12.6% |
How this company gets valued — and why
This business is valued on the cash it is expected to generate, discounted back at its cost of capital — with growth taken from its own ten-year record rather than from guidance.
Discounted cash flowUnderstand this method
- How to Value a Company Using DCF: A Practical Guide for Indian Investors
- Free Cash Flow Explained: The Number Behind Every Valuation
- WACC and the Discount Rate, Explained Simply
- How every one of our it services stocks is valued
The complete valuation
Unlock the complete valuation report
- ✓Fair value per share — with the full working behind it
- ✓Bull, base and bear cases — and what moves between them
- ✓Every assumption — growth, margins, cost of capital, with sources
- ✓Peer comparison — how rivals are priced on the same measures
- ✓Downloadable PDF report — the full write-up, yours to keep
Compare with peers
The same valuation, run side by side.
Persistent Systems vs CoforgeThe two fastest-growing mid-cap IT names, side by side.→Persistent Systems vs InfosysA mid-cap challenger against a large-cap incumbent.→Persistent Systems vs Tata Consultancy ServicesNimble growth against the scale leader.→Frequently asked
Is Persistent Systems overvalued?
At ₹5,478 the market is pricing in roughly 14% sustained growth, against the ~23% its own record supports. That is less than it has delivered — on these numbers the market is asking the business for less than its own record, which usually means it doubts the record repeats.
What is the intrinsic value of Persistent Systems?
It is computed from the filed financial statements using the method that fits this business (discounted cash flow), with every assumption shown alongside the result. The per-share figure and the full working are in the report.
Is Persistent Systems a good long-term investment?
Revenue went from ₹0.03 lakh crore to ₹0.15 lakh crore over the period shown, while return on equity moved from 15.6% to 59.8%. Growing scale on a rising return is a very different proposition from growing scale on a falling one.
How does FairStocks calculate fair value?
From published financial statements. The method is chosen to fit the business — a bank on excess return, a regulated utility on its rate base, a conglomerate by its parts — and every assumption is shown with its source. When the numbers do not support an estimate, no estimate is published. This is an educational research tool: it reports what the model computed and does not recommend buying or selling anything.
What assumptions are used to value Persistent Systems?
A cost of capital of 10.33%, growth drawn from the company's own record rather than from guidance, and the valuation method that fits the business. All of them are listed in the report, with how much each one moves the answer.