Shares of Persistent Systems closed 2.1% higher at ₹5,850, the first uptick in a week, after the company announced the completion of its Qualified Institutional Placement.
The QIP raised ₹4,264 crore through 76,83,981 new equity shares, priced at ₹5,500 per share – a 6% discount to Monday’s closing price and 3.66% below the floor price.
Paid‑up equity will climb from ₹79.07 crore (15.81 crore shares) to ₹82.91 crore (16.58 crore shares) after the issuance, reflecting a 3.33% increase in the share count.
Major recipients include domestic mutual funds: SBI MF (9.38%), ICICI Prudential MF (7.62%), Kotak MF (7.62%) and Aditya Birla Sun Life MF (7.62%). The only foreign portfolio investor is Government Pension Fund Global, with 5.86% of the allotment.
The placement was launched on Oct 21 to refinance the bridge loan for Persistent’s announced $1.45 billion acquisition of Nagarro SE. The rupee debt sales and the QIP together will shore up the balance sheet for the deal.
Back in June, CEO Sandeep Kalra told CNBC‑TV18 that the firm did not anticipate a QIP for the acquisition, yet the subsequent placement shows the company has opted to use equity to fund the transaction.
Q4 results, released in September, showed constant‑currency revenue growth exceeding estimates, but EBIT margin slipped 100 basis points to 15%, versus a 50‑basis‑point drop forecast. Net profit fell 27% sequentially as one‑off deal expenses hit the bottom line, while the company’s margin target remains 16‑17%.
Looking ahead, Persistent has stated it will not pursue another QIP in the coming years unless a compelling need arises, and the acquisition of Nagarro is expected to close by the end of the fiscal year. The stock remains 7% down YTD, but the recent 2.1% gain may signal a short‑term rebound as investors digest the equity injection.