Persistent Systems opened its qualified institutional placement (QIP) on October 21, 2026, setting a floor price of ₹5,550 per equity share. The IT services firm aims to raise up to $450 million, equivalent to ₹42,646.10 crore, through the issuance.

The Special Committee of the Board approved the opening of the issue and adopted the Preliminary Placement Document (PPD) during a meeting held on the same day. The floor price was determined based on the pricing formula prescribed under Regulation 176(1) of the SEBI ICDR Regulations, using October 21, 2026, as the relevant date.

Issue Details and Pricing Mechanism

The company may offer a discount of not more than 5% on the calculated floor price, as permitted by SEBI regulations. The final issue price will be determined by Persistent Systems in consultation with its book running lead managers.

The lead managers appointed for the transaction are J. P. Morgan India Private Limited, IIFL Capital Services Limited, and HSBC Securities and Capital Market (India) Private Limited.

Regulatory Compliance and Timeline

This action follows the approval of a special resolution by shareholders during an Extraordinary General Meeting held on October 5, 2026. The Special Committee meeting commenced at 6:46 pm and concluded at 6:51 pm IST. In compliance with the Code of Conduct for Prevention of Insider Trading, the trading window remains closed for promoters, directors, key managerial personnel, and connected persons until further notice.

What the Numbers Show

The conversion of the $450 million target into ₹42,646.10 crore relies on an RBI/FBIL reference rate of ₹94.7691 per USD as of October 19, 2026. This precise exchange rate underscores the currency risk management inherent in dollar-denominated fundraising for Indian entities, where fluctuations between the reference date and the final allotment can impact the actual rupee proceeds realized.

Persistent Systems reported a consolidated net profit of ₹3,515.14 million for Q2FY27, marking a 25.4% decline from the previous quarter and missing analyst estimates of ₹5.57 billion.

Revenue from operations climbed 30.2% year-on-year to ₹46,639.04 million, driven by strong demand across all key verticals. In USD terms, revenue stood at $487.6 million, reflecting 20.0% YoY growth and marking the company’s 26th sequential quarter of growth. The company released the outcome, audio, and video recordings of its investor and analyst call for the quarter ended September 30, 2026, following board approval of financial statements on October 15, 2026.

Financial Performance Highlights

The company’s standalone results also reflected this divergence between growth and profitability. Standalone net profit stood at ₹4,828.94 million for Q2FY27, up 5.2% YoY but down 20.1% QoQ. The consolidated EBIT margin compressed significantly due to one-time costs associated with the Nagarro SE acquisition.

What the Numbers Show

A clear divergence exists between Persistent’s operational momentum and its reported profitability. While revenue grew 30.2% YoY in INR terms (20.0% in USD), profit before tax fell 26.5% YoY and 27.2% QoQ. This contraction is largely attributable to ₹1,853.41 million in acquisition-related expenses disclosed under "Other Expenses" in the consolidated results. These costs, primarily professional fees and legal advisory charges for the Nagarro SE deal, temporarily depressed margins. Excluding these non-recurring items, the underlying operating performance remains aligned with the strong revenue growth trajectory, as evidenced by the 5.0% YoY growth in Operating PAT. The sharp drop in EBIT margin to 10% from 13.52% in Q1FY27 highlights the immediate impact of these integration costs on operating leverage.

Segment Growth and Acquisition Updates

All three major business segments contributed to the revenue surge in Q2FY27:

• Software, Hi-Tech and Emerging Industries: Revenue rose to ₹19,943.86 million, up 39.2% YoY.
• Banking, Financial Services and Insurance (BFSI): Revenue increased to ₹15,714.77 million, up 26.2% YoY.
• Healthcare & Life Sciences: Revenue grew to ₹10,980.41 million, up 21.6% YoY.

Strategically, the company has moved forward with its expansion plans. As of October 6, 2026, Persistent secured approximately 94.04% of Nagarro SE through a voluntary public takeover offer. The Board also approved long-term debt financing of up to USD 1,250 million and equity raising of up to USD 450 million to fund these acquisitions and general corporate purposes.

Order Book and Client Wins

The order booking for the quarter ended September 30, 2026, was $633.5 million in Total Contract Value (TCV) and $481.0 million in Annual Contract Value (ACV). Key wins included modernizing legacy estates for a Fortune 500 US insurer using cloud-native platforms, and accelerating mainframe modernization through agentic AI ecosystems for a leading hyperscaler. The company also secured deals in Healthcare & Life Sciences focused on unifying fragmented IT operations and scaling data platforms with agentic AI.

Balance Sheet and Cash Flow

The company maintained a healthy cash position, with cash and cash equivalents standing at ₹16,311.85 million as of September 30, 2026, compared to ₹10,749.15 million at the end of FY26. Net cash generated from operating activities was ₹9,280.06 million for the six months ended September 30, 2026. Total assets expanded to ₹1,30,305.15 million, reflecting the consolidation of acquired entities and organic growth.