Understanding the Current Rating
MarketsMOJO’s 'Hold' rating for Persistent Systems Ltd indicates a balanced view of the stock’s prospects. It suggests that while the company demonstrates strong qualities in certain areas, there are factors that temper enthusiasm for immediate buying. Investors are advised to maintain their positions but exercise caution before increasing exposure. This rating was assigned following a comprehensive evaluation of four key parameters: Quality, Valuation, Financial Trend, and Technicals.
Quality Assessment: Strong Fundamentals Underpin Stability
As of 28 February 2026, Persistent Systems Ltd exhibits an excellent quality grade, reflecting robust long-term fundamentals. The company boasts an average Return on Equity (ROE) of 21.92%, signalling efficient utilisation of shareholder capital. Net sales have grown at an impressive annual rate of 28.35%, while operating profit has expanded even faster at 38.08% per annum. This growth trajectory underscores the company’s ability to scale operations profitably.
Moreover, Persistent Systems maintains a conservative capital structure, with an average Debt to Equity ratio of zero, indicating no reliance on debt financing. This financial prudence enhances the company’s resilience against economic fluctuations and interest rate volatility.
Valuation: Premium Pricing Reflects Market Expectations
Despite the strong fundamentals, the stock carries a very expensive valuation grade. Currently, Persistent Systems trades at a Price to Book (P/B) ratio of 10.4, significantly above typical industry averages. This premium valuation reflects high market expectations for future growth and profitability. However, it also implies limited margin for valuation expansion, increasing the risk of price corrections if growth slows.
The company’s Price/Earnings to Growth (PEG) ratio stands at 1.2, suggesting that earnings growth is somewhat aligned with the stock price, but the elevated P/B ratio signals investors are paying a substantial premium for quality and growth prospects.
Financial Trend: Positive Momentum Amidst Market Volatility
The latest data shows Persistent Systems has delivered very positive financial results
Persistent Systems has declared positive results for eight consecutive quarters, demonstrating consistent operational performance. Despite a challenging market environment reflected in the stock’s recent price returns—down 13.72% over the past year and 24.14% in the last month—the company’s profits have risen by 36.5% over the same period, indicating strong underlying business momentum. Technical Outlook: Mildly Bearish Sentiment From a technical perspective, the stock currently holds a mildly bearish grade. Recent price movements show a decline of 1.17% on the day of 28 February 2026, with a one-week drop of 7.32% and a three-month decline of 26.59%. These trends suggest short-term selling pressure and caution among traders. However, the technical weakness is not severe enough to warrant a sell rating, aligning with the overall 'Hold' stance. Institutional Confidence and Market Position Institutional investors hold a significant stake in Persistent Systems, with 52.61% ownership as of the latest quarter. This high level of institutional holding reflects confidence from sophisticated market participants who typically conduct thorough fundamental analysis. Notably, institutional holdings have increased by 0.77% over the previous quarter, signalling continued interest despite recent price volatility. Implications for Investors For investors, the 'Hold' rating suggests that Persistent Systems Ltd remains a fundamentally sound company with strong growth prospects and excellent quality metrics. However, the stock’s elevated valuation and recent technical softness advise caution. Investors should consider maintaining existing positions while monitoring market conditions and company performance closely before committing additional capital. Given the company’s consistent earnings growth and strong capital efficiency, Persistent Systems may appeal to investors with a medium to long-term horizon who are comfortable with valuation premiums and short-term price fluctuations. Just announced: This Small Cap from Tyres & Allied with precise target price is our pick for the week. Get the pre-market insights that informed this selection! Summary In summary, Persistent Systems Ltd’s current 'Hold' rating by MarketsMOJO reflects a nuanced view balancing strong fundamental quality and positive financial trends against a very expensive valuation and mildly bearish technical signals. The company’s consistent growth, zero debt, and high institutional backing provide a solid foundation, but investors should be mindful of the premium price and recent price weakness. As of 28 February 2026, the stock’s performance and financial health suggest it remains a viable holding for investors seeking exposure to the software and consulting sector, provided they are comfortable with the current valuation and market dynamics. Looking Ahead Investors should continue to monitor quarterly results, sector developments, and broader market conditions. Persistent Systems’ ability to sustain its growth rates and manage valuation expectations will be critical in determining future rating adjustments and stock performance. About Persistent Systems Ltd Persistent Systems Ltd operates in the Computers - Software & Consulting sector and is classified as a midcap company. It has demonstrated strong operational execution and financial discipline, positioning it well within its industry despite recent market headwinds. Stock Performance Snapshot (As of 28 February 2026) Day Change: -1.17% | 1 Week: -7.32% | 1 Month: -24.14% | 3 Months: -26.59% | 6 Months: -12.19% | Year-to-Date: -24.73% | 1 Year: -13.72% Financial Highlights Return on Equity (ROE): 21.92% (average long term) Mojo Score and Grade Mojo Score: 61.0 Conclusion Persistent Systems Ltd’s 'Hold' rating reflects a stock that is fundamentally strong but currently priced at a premium with some technical caution. Investors should weigh these factors carefully in their portfolio decisions. Limited Period Only. Start at Rs. 9,999 - Get MojoOne for 1 Year + 3 Months FREE (60% Off) Get 71% Off →
Net Sales Growth (Annual): 28.35%
Operating Profit Growth (Annual): 38.08%
Debt to Equity Ratio: 0 (average)
Price to Book Value: 10.4
PEG Ratio: 1.2
Institutional Holdings: 52.61%
Mojo Grade: Hold (previously Buy as of 05 February 2026)
