Persistent Systems falls 4% as Q2 profit drops 25%

Persistent Systems Limited shares fell about 4% in morning trade on 16 October after Q2 profit dropped 25.4% to Rs 351.5 crore. Support is at Rs 5,150. Persistent Systems Limited [

] shares fell about 4% in morning trade at 9:55 am on 16 October, after falling as much as 5.96% earlier. It also closed lower in the previous two sessions. The Q2 numbers show a mixed picture. Consolidated profit fell 25.4% to Rs 351.5 crore from Rs 471.5 crore. Revenue grew 30.3% to Rs 4,663.9 crore from Rs 3,580.7 crore, and dollar revenue rose 20% to $487.6 million from $406.2 million. EBIT rose 19.5% to Rs 697.7 crore, but the EBIT margin fell 130 bps to 15% from 16.3%. The fall came amid these results, which show strong revenue growth but lower profit and margin. In my view, the near-term tone is weak after the results. The stock had recovered from its lows on the chart and is now pulling back from the recent high near the Rs 6,080 resistance. A fall below the Rs 5,150 support would put lower levels in view. A move above the Rs 6,080 resistance would bring a recovery attempt into focus. Neutral stance while price trades between Rs 5,150 and Rs 6,080. Disclaimer: I do not hold any position in this. This content is for informational purposes only and is not a recommendation to buy or sell. Investments in securities are subject to market risks. Please read all related documents carefully before investing.