Persistent Systems Ltd — Q4 FY26

Persistent Systems Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=LJE11GhlFLA Published: 3 weeks ago

0:01 1 second Ladies and gentlemen, good day and welcome to Persistent Systems earning conference call for the fourth quarter of FY26 ended March 31st, 2026. 0:13 13 seconds We have with us on the call today Dr. 0:15 15 seconds Anandh Pande, Chairman and Managing Director, Mr. Sep Kalra, Executive Director and Chief Executive Officer, 0:23 23 seconds Mr. Vinit Desai, Executive Director and Chief Financial Officer, Mr. Nitishhastava, chief technology officer, engineering hyper productivity. 0:34 34 seconds Mr. Bharat Narayan, executive vice president, global BFSI and Europe geohad and Mr. Sarabi, corporate vice president, finance and strategy. 0:45 45 seconds Please note all participants line will be in listenonly mode and there will be an opportunity for you to ask questions after management's opening remark. 0:54 54 seconds Should you need any assistant during the conference call, please raise your hand from the participant tab on the screen. 1:00 1 minute While asking questions, request you to please identify yourself and your company. Please note this conference is being recorded. 1:08 1 minute, 8 seconds I now hand over the conference to Mr. Sarabi. Thank you and over to you sir. 1:14 1 minute, 14 seconds Thank you Andid. A very good day, good evening uh to all. We sincerely appreciate your presence and 1:22 1 minute, 22 seconds participation in today's call. I will quickly outline the agenda for today's call. SEP will begin with an overview of 1:30 1 minute, 30 seconds our results and commentary on the business. Venit will take you through the financial details and key operational metrics for this quarter. 1:38 1 minute, 38 seconds Nitish our CTO engineering hyperproductivity business will provide details on expansion of our AI capabilities and offerings in the 1:46 1 minute, 46 seconds quarter gone by. Barat our head of BFSI vertical and Europe region will take you through the details of our BFSI vertical 1:55 1 minute, 55 seconds and our recent customer wins. I will then provide an overview of our key deal wins and awards and recognitions for this quarter. 2:04 2 minutes, 4 seconds Sundep will then come back for a quick summary of the prepared remarks post which we will open the conference for questions. 2:11 2 minutes, 11 seconds Let me also remind you that as part of our prepared remarks and during Q&A, we may make certain statements which are forward-looking and may involve significant uncertainty. 2:22 2 minutes, 22 seconds Persistent does not take any responsibility to update such forward-looking statements and your discretion is warranted while making any investment decisions. 2:31 2 minutes, 31 seconds With this, let me hand over to Sep for his prepared remarks. 2:36 2 minutes, 36 seconds Thank you, Sarup. Good evening, good morning and good afternoon to all the folks depending on where you're joining from. I hope all of you are doing well. 2:43 2 minutes, 43 seconds Let me start with a quick financial summary of the quarter gone by. We achieved a healthy revenue growth of 3.2% quarteron quarter and 16.2% 2:52 2 minutes, 52 seconds yearonear delivering USD 436 million in Q4 FI26. 2:57 2 minutes, 57 seconds This marks our 24th sequential quarter of revenue. In ruby terms, the growth for the quarter came in at 7.4% 4% 3:05 3 minutes, 5 seconds quarter on quarter and 25.1% yearon year. In constant currency terms, the growth for the quarter was 3.4% quarter 3:12 3 minutes, 12 seconds on quarter. The IBIT margin for the quarter came in at 16.3% translating to an EBIT growth of 21.4% 3:20 3 minutes, 20 seconds and 30.4% Q on Q and Y on Y respectively. 3:25 3 minutes, 25 seconds The profit after tax for the quarter came in at 13.1% translating to a bad growth of 20.4% 4% quarteron quarter and 33.7% yearonear. 3:35 3 minutes, 35 seconds Coming to the full financial year 26, FI26 revenue came in at USD 1.65 billion 3:42 3 minutes, 42 seconds translating into 17.4% year-on-year growth. In rupee terms, this translates to 23.5% year-on-year growth. The EBIT 3:50 3 minutes, 50 seconds margin for FI26 came in at 15.6% a 31.1% year-on-year growth. Profit after tax 3:59 3 minutes, 59 seconds for the full year came in at 12.6% and increase of 33.2% year-on-year in absolute terms. Beneath our CFO will 4:06 4 minutes, 6 seconds provide a detailed color on the financials and margin movement later in this call. 4:12 4 minutes, 12 seconds Coming to the order book for the quarter, the total contract value for the quarter stood at USD 600.8 million 4:20 4 minutes, 20 seconds with total contract value of the new bookings coming in at dollar 48.9 million. 4:26 4 minutes, 26 seconds The annual contract value of bookings for this quarter is dollar 445.1 million out of which annual contract value from 4:32 4 minutes, 32 seconds new bookings contributed to a healthy $272.7 million. 4:38 4 minutes, 38 seconds The total contract value for the year came in at US2.4 billion while the corresponding annual contract value came in at US 1.8 4:46 4 minutes, 46 seconds billion. Given that 80% of our revenue comes from the US, we normally see peak renewals and hence overall bookings in 4:53 4 minutes, 53 seconds the December quarter which coincides with our customers fiscal year end. The sequential moderation in bookings this quarter is consistent with this normal seasonality seen in prior years as well. 5:06 5 minutes, 6 seconds To remind everyone, both TCB and ACB numbers include all bookings small and large renewals as well as new bookings across existing and new customers. 5:16 5 minutes, 16 seconds Also, as highlighted in our earlier calls, our revenue conversion on a quarterly basis is a function of ACB bookings closed in previous quarters as 5:24 5 minutes, 24 seconds well as the conversion from multi-year book deals booked in previous years, which are included in our total contract value or TCB bookings that we announced 5:31 5 minutes, 31 seconds on a quarterly basis. Now, let me give you a color on our client movements across various reported categories. This 5:39 5 minutes, 39 seconds quarter, we witnessed healthy year-on-year growth among our various client buckets with our top five customer revenue growing by 20.7%, top 5:47 5 minutes, 47 seconds 10 by 19.4%, top 20 by 20%, top 50 by 20.9%, and top 100 by 19.5%. 5:57 5 minutes, 57 seconds Coming to the year-on-year movement of customers across various reported buckets, customers with annual revenues greater than US dollar 75 million 6:05 6 minutes, 5 seconds remained stable at four on a year-on-year basis. Those with dollar 50 million plus annual revenue remained stable at 4. Dollar 20 million plus 6:14 6 minutes, 14 seconds increased from 10 to 12. Dollar 10 million plus increased from 21 to 29. 6:20 6 minutes, 20 seconds Those in dollar 5 million plus category saw a significant increase from 55 to 62 over the last 12 year. The customers on 6:27 6 minutes, 27 seconds 1 million plus category increased from 191 to 200. 6:32 6 minutes, 32 seconds This demonstrates our consistent success in cultivating deeper, more resilient partnerships with our customers over time. 6:39 6 minutes, 39 seconds Now coming to the details of our performance across geographies. In terms of year-on-year growth this quarter in terms, North America revenue grew by 6:47 6 minutes, 47 seconds 17.4%, Europe grew by 12.3%, India by 4.2% and the rest of the world grew by 6:54 6 minutes, 54 seconds 41.4% although on a smaller base for the full year, North America grew 17.2%. 7:01 7 minutes, 1 second Europe grew 26.7%, India 9.5% and the rest of the world by 27.5%. 7:09 7 minutes, 9 seconds Coming to the industry segments, this quarter's growth was led by banking financial services vertical with 24.3% growth year on year followed by 7:17 7 minutes, 17 seconds healthcare life sciences and software high-tech and emerging verticals which grew by 14.1% and 11.2% respectively on a year-on-year basis. 7:27 7 minutes, 27 seconds For the full year FI26, banking financial services vertical led the growth with 28.4% followed by high-tech and emerging verticals which grew by 7:35 7 minutes, 35 seconds 13.8% and healthcare life sciences which grew at 10.1%. 7:40 7 minutes, 40 seconds Coming to an update on the interim dividend and the final dividend. I'm pleased to share with you that the board of directors has recommended a final 7:48 7 minutes, 48 seconds dividend of rupes 18 per share on face value of rupees 5 per share. This brings the total dividend for FI26 at rupees 40 7:57 7 minutes, 57 seconds including the interim dividend and this compares to rupees 35 in FI25. 8:03 8 minutes, 3 seconds The dividend recommended by the board is subject to approval at the ensuing annual general meeting. 8:09 8 minutes, 9 seconds Coming to the AI updates, in the quarter gone by, we saw significant announcements on the AI road map by various ecosystem players such as 8:16 8 minutes, 16 seconds Enthropic, OpenAI, Nvidia, Microsoft, Google, Snowflake, Data Bricks and others. We do expect the pace of 8:25 8 minutes, 25 seconds adoption in both the tech companies and enterprises to accelerate significantly in the coming quarters with tech companies leading the way. 8:33 8 minutes, 33 seconds We are steadily making progress on our AI journey and as a part of our capability build and workforce transformation. We recently concluded our persistent AI huddle in Pune. 8:43 8 minutes, 43 seconds As a part of our huddle, 1700 plus of our team members including business leaders, delivery heads, delivery partners, technical architects and 8:52 8 minutes, 52 seconds senior engineers participated during this event. We did a deep dive into our AI offerings across the three pillars of our ALE platform approach. 9:02 9 minutes, 2 seconds Engineering hyperproductivity, business hyperproductivity, and enterprise data readiness. 9:08 9 minutes, 8 seconds All the participants underwent hands-on experience of executing end-to-end real world use cases using various AI stacks 9:17 9 minutes, 17 seconds such as OpenAI, Enthropic, Copilot, and SAS. The end goal of the huddle was to strengthen execution for our expanded AI 9:25 9 minutes, 25 seconds platform and offerings and enable GTM readiness across the organization. My colleague Nitish will be detailing our 9:33 9 minutes, 33 seconds overall progress on the AI front a little later in this call. Further to a successful hurdle, we now conducting our annual flagship hackathon semicolons 9:42 9 minutes, 42 seconds involving our entire employee base. The focus of this would be on building AI native solutions and to continue the 9:48 9 minutes, 48 seconds momentum in bringing our workforce up to the latest in terms of the latest technology stacks and our platforms. 9:57 9 minutes, 57 seconds We also intend to host our AI investor day in early June time frame at our offices in Pune to showcase our AI capabilities, our AI partnerships as 10:05 10 minutes, 5 seconds well as some of the Maki customer case studies. We make we aim to make this investor day comprehensive for our investor community by including a 10:14 10 minutes, 14 seconds hands-on AI hackathon involving our investors in collaboration with our technical and business. We are excited about the event and we look forward to 10:22 10 minutes, 22 seconds active participation from our investor community. 10:26 10 minutes, 26 seconds Coming to other organizational updates, I'm pleased to share we have further strengthened our leadership team with the addition of two leaders Ruji Kulhari 10:34 10 minutes, 34 seconds and Hari Abankar. Ruji joined us as an executive vice president, enterprise strategy and execution. In her role, she 10:41 10 minutes, 41 seconds will be partnering closely with me and our executive leadership team to drive critical priorities working across business units and functions to 10:50 10 minutes, 50 seconds translate these priorities into clearly defined initiatives with measurable outcomes. She has a rich work experience 10:56 10 minutes, 56 seconds working across firms such as Infosys, EXL, Unicus, etc. 11:01 11 minutes, 1 second Hari joined us as executive vice president and global head of private equity and professional services, spearheading our company's global strategy and growth across private 11:10 11 minutes, 10 seconds equity investors, their portfolio companies and professional services organizations. 11:15 11 minutes, 15 seconds Prior to joining us, Har has spent significant time at McKenzie consulting with enterprise software companies. With this, I would like to invite Bened to provide more details on our connections. 11:26 11 minutes, 26 seconds Ven over. Thank you Sil. 11:31 11 minutes, 31 seconds Good evening and good day to all. Thank you for taking the time to join us today. Let me now take you through the financial highlight for the quarter as well as for the full year gone by. 11:42 11 minutes, 42 seconds Q4 A FI26 revenue stood at $436 million registering a year-on-year growth of 16.2%. 11:51 11 minutes, 51 seconds In rupee terms, it translates into 40,559.4 4 million rupees, a growth of 25.1% yearonear. 12:00 12 minutes EIT for this quarter was 6,591.6 million rupees, translating to a growth of 30.5% yearonear. 12:09 12 minutes, 9 seconds A bit margin for Q4 FI26 came in at 16.3% 17 basis point increase yearon year. 12:18 12 minutes, 18 seconds I'll now share the highlights for the full year 526. 12:23 12 minutes, 23 seconds Revenue came in at $1,654.4 million US, a year-on-year growth of 17.4%. 12:32 12 minutes, 32 seconds In rupee terms, this translates to 1 lak 47,484.5 million rupees, growth of 23.5% yearonear. 12:44 12 minutes, 44 seconds EIT for FI26 was 23,34.7 million rupees translating to a growth of 31.5% yearonear. 12:54 12 minutes, 54 seconds EIT margin for FI26 came in at 15.6% an improvement of 90 basis point year on year. 13:02 13 minutes, 2 seconds Let me now give you a cotton quarter epit margin walk through in terms of headwinds. Increase in 13:10 13 minutes, 10 seconds consulting and advisory expenses related to corporate development initiatives resulted in a margin impact of 60 basis point at this quarter. 13:20 13 minutes, 20 seconds Increase in subcon cost expenses, purchase of software licenses and travel related to annual planning exercise 13:29 13 minutes, 29 seconds cumulatively led to an impact of 70 basis point on our margins this quarter. 13:35 13 minutes, 35 seconds In terms of tailwinds, U4 margins benefited by 220 basis point due to absence of one-time cost impact of the 13:44 13 minutes, 44 seconds new wage code which was incurred in the previous plot. 13:49 13 minutes, 49 seconds Operational efficiencies resulted in an improvement of 40 basis point in margin. 13:55 13 minutes, 55 seconds Favorable currency helped the margin by 60 basis point. 14:00 14 minutes All these headwinds and tailwinds put together have resulted in an improvement of 190 basis points in our EIT margin on 14:08 14 minutes, 8 seconds a quarter-on quarter basis. Other income net of finance cost stood at 136.3 14:15 14 minutes, 15 seconds million rupees as against 153.5 million rupees in Q3 of FI26. 14:22 14 minutes, 22 seconds This dip is primarily on account of marktomarket losses on our mutual fund investments. 14:28 14 minutes, 28 seconds We had a foreign exchange gain of 11.9 million rupees this quarter as against a loss of 154.3 uh million rupees in Q3 of FI26. 14:41 14 minutes, 41 seconds Effective tax rate for the quarter came in at 21.5% versus 22.2% last quarter. 14:49 14 minutes, 49 seconds Effective tax rate for FI26 stood at 22.6%. 14:56 14 minutes, 56 seconds Profit after tax was at 5,292.6 million rupees, a growth of 33.7% yearonear. 15:04 15 minutes, 4 seconds This translates to a pack margin of 13.1%. 15:10 15 minutes, 10 seconds Earnings per share was 33 rupees 80 pesa per share in Q4 of FY26 compared to 28 15:17 15 minutes, 17 seconds rupees 20 pesa per share in the previous quarter. Yearon-year growth in EPS was 31.9%. 15:27 15 minutes, 27 seconds Excluding cash from capital employed, the return on capital employed for Q4 FI26 came in at 45.2% versus 43.8% in the previous quarter. 15:37 15 minutes, 37 seconds Total cash in investments stood at 27,622.1 million rupees as of 31st March 2026. 15:48 15 minutes, 48 seconds In this quarter, the build DSO came in at 53 days while the unbuilt DSO came in at 27 days. Build DSO decreased by 4 15:57 15 minutes, 57 seconds days and unbuilt DSO increased by 3 days compared to Q3 of FI26. 16:05 16 minutes, 5 seconds OCF to pat or came in at 77% in Q4 of 526 compared to 91% in the previous 16:12 16 minutes, 12 seconds quarter. This decline in additional cash flow to PAT was primarily on account of higher proportion of unbridled revenue 16:20 16 minutes, 20 seconds in this quarter which we expect to normalize in the next quarter. 16:25 16 minutes, 25 seconds Additional delays in the receipt of tax refunds and annual payment towards insurance premium have contributed to this decline in OCF to PAT. 16:36 16 minutes, 36 seconds For the full year FI26, our operational cash flow to PAT came in at 93.6% compared to 82.6% for FI25. 16:47 16 minutes, 47 seconds Forward contracts outstanding as of 31st March 2026 were $500 million US at an average rate of 90 rupees 70 per dog. 16:59 16 minutes, 59 seconds Let me now give you some operational updates. 17:02 17 minutes, 2 seconds At the end of Q4 of FI26 our total headcount stood at 27,52 an increase of 791 from the previous quarter. 17:13 17 minutes, 13 seconds Utilization in this quarter remained flattish at 88%. 17:18 17 minutes, 18 seconds Trailing 12 months attrition for this quarter came in at 13% compared to 13.5% in the previous quarter. 17:26 17 minutes, 26 seconds Coming to updates on ESG, our EG performance continues to translate into risk resilience, 17:34 17 minutes, 34 seconds long-term value creation and strong external validation. We are positioning we are positioned in the top 10% of the 17:41 17 minutes, 41 seconds S&T sustainability yearbook with a score of 86 out of 100. Our CDP climate change 17:48 17 minutes, 48 seconds rating improved from B to A placing us amongst the top 4% of the companies globally. 17:56 17 minutes, 56 seconds Further we rank third overall and second in the IT sector in the business world's India's most sustainable companies 18:04 18 minutes, 4 seconds reinforcing our sector leadership in the perpetual capital Hun India 18:11 18 minutes, 11 seconds Impact 50 2026 we were ranked 13th reflecting a measurable impact at scale 18:18 18 minutes, 18 seconds notably we achieved carbon neutrality two years ahead of target resulting in the number one rank amongst the companies target targeting carbon 18:27 18 minutes, 27 seconds neutrality by 2030 and number three amongst the sustainable software and services companies a strong indicator of 18:35 18 minutes, 35 seconds execution credibility rather than intentbased commitments. 18:40 18 minutes, 40 seconds We were featured in the Dun Brad Street's India leading ESG entities report strengthening our overall ESG 18:47 18 minutes, 47 seconds risk and opportunity profile on the social dimension being named amongst the 18:53 18 minutes, 53 seconds ETH best organization for women 2026 reinforces talent sustainability 19:00 19 minutes leadership depth and inclusion critical factors for long-term performance in knowledge businesses. 19:08 19 minutes, 8 seconds Collectively, these outcomes reflect a disciplined ESG strategy embedded into governance and operations, supporting 19:15 19 minutes, 15 seconds business resilience, stakeholder trust, and sustained shareholder value. With this, let me now invite Nitish to share updates on our AI journey. 19:27 19 minutes, 27 seconds Thank you, Vinit. Let me update you all on the progress of our AI journey as we continue to help our clients adopt and scale AI with measurable outcomes. 19:38 19 minutes, 38 seconds As you know our AI strategy recorded on three key pillars. Engineering hyperproductivity, business hyperproductivity and 19:46 19 minutes, 46 seconds enterprise data readiness along with responsible AI. Engineering hyperproductivity is about embedding AI 19:54 19 minutes, 54 seconds across the software development life cycle. So engineering teams can deliver faster, improve quality and do more with 20:02 20 minutes, 2 seconds less. Business hyperproductivity is about applying AI to automate and optimize business processes, workflows 20:10 20 minutes, 10 seconds and decision makings across enterprise functions so organizations can drive efficiency and faster outcomes. 20:18 20 minutes, 18 seconds Enterprise data readiness is about preparing an enterprise data foundation with the right structure, governance and 20:26 20 minutes, 26 seconds accessibility. So AI can deliver accurate, contextual and trusted outcome at scale. Together these three pillars 20:34 20 minutes, 34 seconds define the path enterprises must take to realize the full value of AI. 20:40 20 minutes, 40 seconds While AI can take enterprises a long way on their transformation journey, the true uh challenge lie in overcoming the 20:49 20 minutes, 49 seconds last mile. Achieving this requires making AIdriven outcome repeatable, transparent and governed at scale so 20:57 20 minutes, 57 seconds that the success is sustained and trusted throughout the enterprise. 21:02 21 minutes, 2 seconds Delivering enterprise AI value requires contextualized intelligence and repeatable reliable execution. This 21:10 21 minutes, 10 seconds needs a structured approach across three enterprisewide layers. The core foundation layer ensure a secure, 21:17 21 minutes, 17 seconds governed, interoperable and cost control foundation for enterprise AI operation. 21:23 21 minutes, 23 seconds It is vital for scalability, compliance and trust. The governed grounding layer 21:30 21 minutes, 30 seconds contextualizes and provides reliable, traceable access to enterprisewide data, processes, knowledge and history. It 21:39 21 minutes, 39 seconds builds trust trusted enterprise memory with domain awareness, lineage, business rules and compliance. The work 21:47 21 minutes, 47 seconds orchestration layer coordinates and integrates people, agent, applications, resources and systems in processdriven 21:55 21 minutes, 55 seconds workflows with clear control, accountability and governance. Our platforms Saswa, Iora and Genai hub 22:03 22 minutes, 3 seconds brings all the three together. Our methodologies and accelerators extend this into partners ecosystem. 22:12 22 minutes, 12 seconds This helps our customers realize AI value through a combination of our own IP and the best of what our partners 22:19 22 minutes, 19 seconds offers. We continue to invest in our innovations to help our clients get the real values through their AI 22:27 22 minutes, 27 seconds initiatives. We have filed over 120 patents and published research to strengthen the depth of our platforms and deliver enterprisegrade results. 22:38 22 minutes, 38 seconds In engineering hyper productivity, SASA continues to be the central driver for our clients. 22:44 22 minutes, 44 seconds Over the last several quarters, we have seen progression from individual productivity to team intelligence and execution at enterprise scale through 22:53 22 minutes, 53 seconds this asa platform, bridging the last mile gap of AI adoption. This approach is now repeatable across verticals, 23:01 23 minutes, 1 second converting enterprise technologies and AI assessment into a 90-day actionable road map, including for private equity 23:09 23 minutes, 9 seconds due diligence and transformation at scale. Let me share an example of where we have where we were selected to 23:16 23 minutes, 16 seconds transform the SDLC for a public safety system used by law law enforcement. 23:23 23 minutes, 23 seconds This client provide the law enforcement agencies and public officials with the technology and tools you need to manage local, state and federal offender 23:32 23 minutes, 32 seconds registry processes effectively. SASA brought organization context together from sources like code repositories, 23:39 23 minutes, 39 seconds ticket communication channel and planning tools. used this engineering data to create purpose-built SLMs 23:46 23 minutes, 46 seconds alongside anthropic and unified agents and humans into a single execution loop. 23:53 23 minutes, 53 seconds It map dependencies and risk, modernized stack into a cloudnative architecture without disrupting operation, embedded 24:01 24 minutes, 1 second continuous security and privacy controls, and accelerated engineering through governed releases and full observability. 24:09 24 minutes, 9 seconds The result is a secure scalable platform with continuous delivery and zero customer impact. We also expanded SASA 24:17 24 minutes, 17 seconds to run as as an native layer on the core foundation that integrates with partners platforms like claude, GitHub copilot 24:25 24 minutes, 25 seconds and openai codeex. This gives clients more choice in their models and tool ecosystem while SAS adds its enterprise 24:34 24 minutes, 34 seconds value on top of any platform they select. Building on our partnership with digital ocean, clients can now access 24:42 24 minutes, 42 seconds anthropic and open AI among other models and tools and build or consume agentic solutions through AI. 24:50 24 minutes, 50 seconds They are they also get private cloud and sovereign deployment options. All of this comes layered with our enterprise 24:58 24 minutes, 58 seconds value on top. On business hyperproductivity, we continue to reimagine end-to-end workflows as 25:05 25 minutes, 5 seconds self-orgating ecosystem of AIS powered by our domain-driven reasoning engine and a robust core architecture that 25:13 25 minutes, 13 seconds helps our customer achieve more accurate outcomes at production scale. We upgraded the Genai hub and agent studio 25:20 25 minutes, 20 seconds with agent runtime orchestration, evaluation and knowledge management abilities and expanded the agent processing unit for agent collaboration. 25:30 25 minutes, 30 seconds Our agent portfolio now exceeds 500 agents built inhouse and across partners ecosystem including Google, Microsoft, Salesforce and Nvidia. 25:42 25 minutes, 42 seconds Let me share an example. 25:45 25 minutes, 45 seconds We are working with a leading pharma company focused on diabetes and metabolic disorder. We are helping them 25:51 25 minutes, 51 seconds tackle a core challenge in early uh stage drug discovery on how to unify fragmented clinical and research data and break it into actionable using AI. 26:03 26 minutes, 3 seconds The client wanted to move beyond silo data set and manual processes towards a predictive AIdriven discovery model. We 26:12 26 minutes, 12 seconds built a disease specific knowledge graph from proprietary data set creating a structured intelligence layer for downstream AI use cases within 26:21 26 minutes, 21 seconds fine-tuned openw weight foundation model using clinical data to develop domain specific LLMs for drug discovery. The 26:29 26 minutes, 29 seconds solution now runs on Google cloud platform with Google's healthcare AI models like Medjma and TXMA enabling 26:38 26 minutes, 38 seconds scalable model training and experimentation. 26:41 26 minutes, 41 seconds What makes this unique is the combination of deep domain data, hyperscaler native AI models and platform engineering. We are effectively 26:50 26 minutes, 50 seconds moving from data aggregation to LLMdriven discovery workflows embedded directly into research and development. 26:58 26 minutes, 58 seconds Let me highlight another example where we worked with a leading global pharmaceutical company to accelerate drug discovery and innovation. This is 27:07 27 minutes, 7 seconds based on a joint solution that we built together with NVDIR's biio toolkit. This solution empowers 27:15 27 minutes, 15 seconds computational biology scientists to predict protein structure, generate novel molecules, design new protein and 27:22 27 minutes, 22 seconds simulate molecular interaction between target uh proteins and leats. It is built on core NVIDIA stack. It is 27:31 27 minutes, 31 seconds contextualized by our deep expertise in protein structure and coordinated through plugandplay micros service with industry standard APIs. 27:40 27 minutes, 40 seconds This enable rapid workflow customization and scalability. 27:45 27 minutes, 45 seconds Enterprise data readiness remain the single most important driver for scaled AI adoption. We expanded enterprise 27:52 27 minutes, 52 seconds context, semantic layer and knowledge graph within iOS data not just AI available but AI consumable. 28:01 28 minutes, 1 second We industrialized modernization using using agentic accelerator to mitigate legacy data stack into cloudnative 28:10 28 minutes, 10 seconds platform. This delivered real outcomes including moni modernizing thousands of report with significant automation and 28:18 28 minutes, 18 seconds establishing data lineage for regulatory alignment. To share one example, a leading US bank faced significant 28:26 28 minutes, 26 seconds technical depth from multiple acquisition with legacy systems reaching end of life and increasing risk 28:33 28 minutes, 33 seconds exposure. Using our IORA migrate accelerators, we modernize their legacy BI and report landscape to cloudnative 28:41 28 minutes, 41 seconds platforms, covering over 3,500 reports with more than 50% automation, reducing risk and making the in environment AI 28:50 28 minutes, 50 seconds ready. In summary, our AI strategy has moved from foundational framework to platformled execution and operating model that clients can adopt at scale. 29:01 29 minutes, 1 second We continue to invest in deep research in patentbacked innovation in our platforms and in our partners ecosystem 29:09 29 minutes, 9 seconds while bridging the last mile of AI adoption and delivering measurable impact to our clients. With this I would 29:16 29 minutes, 16 seconds now ask Barat to take over to talk about our BFSI vertical details. 29:22 29 minutes, 22 seconds Thank you Nitish. Warm greetings to everyone participating in today's call. 29:26 29 minutes, 26 seconds I am Barat Naran. I head BFSI vertical and Europe region at persistent. 29:32 29 minutes, 32 seconds I will address three primary topics today in this poll. Performance of BFSI vertical, key drivers of the market demand and our execution strategy. 29:43 29 minutes, 43 seconds Coming to performance, BFSI vertical demonstrated a robust growth of 24.4% 4% 29:50 29 minutes, 50 seconds year-on-year from Q4 perspective with an annualized run rate of USD 600 million. 29:56 29 minutes, 56 seconds With respect to full FI26 financial year, the revenue growth came at 28.4% 30:03 30 minutes, 3 seconds yearonear, a result of expanding relationships with our existing customers and new clients wins across North America, Europe, and Australia. 30:14 30 minutes, 14 seconds Our BFSI vertical depth is underpinned by a strong customer base that includes 30:23 30 minutes, 23 seconds top four out of five banks in US as well as India, top three out of five large global fintexs and top three out of five 30:32 30 minutes, 32 seconds brokerage, wealth managers and retirement service providers. 30:36 30 minutes, 36 seconds Our growth in VFSI is attributable to our deliberate focus on three pillars of execution. 30:44 30 minutes, 44 seconds First pillar is specialized subvertical allowing us to focus on retail and commercial banks, capital markets, insurers, payment providers and fintex. 30:57 30 minutes, 57 seconds Second pillar is doubling down our investment on what we do the best that is product engineering, data modernization and cloud transformation. 31:08 31 minutes, 8 seconds And the third pillar is sharper focus on top 30 existing clients and winning new strategic clients for future growth across the region. 31:19 31 minutes, 19 seconds Our strong engineering DNA, deep domain knowledge in financial services and AI 31:26 31 minutes, 26 seconds platforms like SASA, Iora, Janaihub has created a differentiated positioning for us with our client. 31:34 31 minutes, 34 seconds We are increasingly being brought in as a credible challenger to tier one outsourcing firms by our customers and prospect. 31:44 31 minutes, 44 seconds Now let me cover what we are observing as a broad themes across BFSA market segments and how we are engaging with clients to address them. 31:53 31 minutes, 53 seconds The BFSA sector is transforming to increase margins, strengthen operations and enhance capital efficiency. 32:03 32 minutes, 3 seconds Clients are optimizing run costs by modernizing platforms like their core banking policy administration and 32:11 32 minutes, 11 seconds brokerage platforms with cloudnative architectures. 32:15 32 minutes, 15 seconds Concurrently, upgrading enterprise data infrastructure has become a critical enabler for AI adoption while 32:23 32 minutes, 23 seconds facilitating the compliance mandate necessary to mitigate operational risk and navigate stringent regulatory 32:31 32 minutes, 31 seconds frameworks like DO, BCBS 239 and ESG reports. 32:38 32 minutes, 38 seconds Capitalizing on this modernized foundation, the institutions are integrating traditional payments and 32:46 32 minutes, 46 seconds digital assets via real-time network, blockchain settlements and tokenized real world assets, aiming to improve 32:55 32 minutes, 55 seconds liquidity and minimize counterparty friction. 32:59 32 minutes, 59 seconds We see real shift in the spend from business asusual programs to transformation initiatives that are 33:07 33 minutes, 7 seconds preparing the clients to adopt AI at enterprise level. We are involved in accelerating clients transformation 33:14 33 minutes, 14 seconds journey in following areas. Improve time to market for new product rollout. 33:20 33 minutes, 20 seconds Transform complex legacy landscape. End to modernization of data and reimagine customer experience. 33:28 33 minutes, 28 seconds There are four principal focus areas where we support our clients to realize their business growth. Let me share each 33:36 33 minutes, 36 seconds one of them now. First one being AILE software engineering. 33:42 33 minutes, 42 seconds The way software gets built is changing fundamentally. 33:46 33 minutes, 46 seconds While Nitish called this out earlier, let me focus on sharing an example where we have adopted AI solutions to help our 33:54 33 minutes, 54 seconds client earlier in the year. for a large US insurer operating decades old 34:02 34 minutes, 2 seconds cobalt-based policy administration platform supporting millions of policyh holders. Legacy infrastructure had 34:10 34 minutes, 10 seconds become a significant barrier to modernization. 34:14 34 minutes, 14 seconds We applied AI augmented engineering approach to migrate the core policy life cycle directly onto TURI a leading insurance platform. 34:26 34 minutes, 26 seconds The second focus area is associated with payments and digital asset. 34:31 34 minutes, 31 seconds Realtime settlement has evolved from innovation initiative to competitive baseline. To give an example for a large 34:39 34 minutes, 39 seconds financial technology provider, enabling real-time payments on the Federal Reserve's FedNo network delivering a 34:48 34 minutes, 48 seconds compliant production ready capability was a critical milestone. 34:53 34 minutes, 53 seconds Towards this goal, Persistent designed and built a cloudnative Fed now payment solution supporting customer credit 35:01 35 minutes, 1 second transfers and merchant dispersement uh use cases. 35:06 35 minutes, 6 seconds The scope was to lead the program end to end from system architecture through integration and certification readiness. 35:16 35 minutes, 16 seconds On similar lines, we were selected by one of the largest banks in Nordic region to modernize its payments 35:23 35 minutes, 23 seconds platform, implement regulatory changes and augment core transaction capability. 35:30 35 minutes, 30 seconds We were chosen against established incumbent uh service providers owing to our strong payments domain capability. 35:40 35 minutes, 40 seconds The third focus area that I want to highlight in the data infrastructure is one common challenge most of the 35:48 35 minutes, 48 seconds clients are facing across BFSA segment is modernizing and improving quality of data prior to driving overall AI adoption for various business use cases. 35:59 35 minutes, 59 seconds Underlying data remains the focal point in every client engagement. To share an example for a large European bank where 36:09 36 minutes, 9 seconds hundreds of siloed systems were creating direct regulatory exposure across Basel, 36:15 36 minutes, 15 seconds AML and KYC, we deployed IORA. Our agentic AI solution for enterprise data 36:22 36 minutes, 22 seconds management. The result delivered is documentation cycle reduced by roughly 70% 36:29 36 minutes, 29 seconds with AI decoding and validating over 25,000 lines of legacy code. The fourth 36:37 36 minutes, 37 seconds pillar of focus area is nonlinear cost transformation. 36:42 36 minutes, 42 seconds Banking, capital markets and insurance clients are pursuing what we would describe as nonlinear cost 36:50 36 minutes, 50 seconds transformation through digitization of business processes using agentic solutions. The objective is not 36:58 36 minutes, 58 seconds incremental efficiency but fundamentally restructure end toend business processes. To give you an example, 37:06 37 minutes, 6 seconds Persistent was selected by one of the largest life insurance providers in Australia to co-uild its digital 37:13 37 minutes, 13 seconds underwriting platform to replace fragmented manual insurance processes with fully digital workflow-driven 37:22 37 minutes, 22 seconds system. The transformation focuses on automating underwriting, improving compliance and auditability, and 37:31 37 minutes, 31 seconds enabling end-to-end customer and advisor journey. 37:34 37 minutes, 34 seconds The customer will benefit from significant efficiency gains thereby reducing cost, accelerating policy 37:41 37 minutes, 41 seconds issuance and improving risk management in a regulated environment. 37:47 37 minutes, 47 seconds Now let me close with the view of our execution strategy. 37:51 37 minutes, 51 seconds Our strategy continues to stay anchored on four priorities. 37:56 37 minutes, 56 seconds Embedding AI into existing engagements to drive customer satisfaction. 38:02 38 minutes, 2 seconds Proactively solving high value problems for our current client, winning strategic new relationships 38:09 38 minutes, 9 seconds through our differentiated offerings and continuing to build deep engineering and domain talent for our client. We are 38:17 38 minutes, 17 seconds committed to partnering with financial institutions as they navigate their modernization journey and deploying AI 38:24 38 minutes, 24 seconds solution. Our focus remains delivering tangible value during this pivotal period. With this I will now hand over the proceedings to Sor. 38:35 38 minutes, 35 seconds Thank you Vat. 38:37 38 minutes, 37 seconds In the interest of time I will be brief in mentioning one key customer case study from our high-tech vertical and 38:45 38 minutes, 45 seconds I'll briefly cover the uh awards and recognitions as well. A lot of these details are mentioned in our investor deck which is uploaded on our website. 38:55 38 minutes, 55 seconds So, Persistent was selected by Japan headquartered global B2B industrial technology leader as a long-term 39:03 39 minutes, 3 seconds transformation partner to help shift from hardwarecentric products to software platforms. 39:10 39 minutes, 10 seconds The program spans end toend engineering carveout and offshore operations across SAP, IT and data analytics. The benefit 39:19 39 minutes, 19 seconds to the customer includes faster time to market through a scaled global engineering organization and reinvestment of productivity benefits into innovation and growth. 39:31 39 minutes, 31 seconds This deal is special since it is more than $150 million in TCB with a marquee net new customer and is one of the largest SAP services deal for us. 39:44 39 minutes, 44 seconds Coming to award key awards and recognitions for the quarter. Persistent was named as the fastest growing IT services brand globally in the 2026 39:53 39 minutes, 53 seconds brand finance IT services 25 report. We received multiple recognitions from the Everest group including being named a 40:00 40 minutes leader in Everest group private equity services peak metrics assessment 2026 as well as a leader in Everest group software product engineering peak metrics assessment 2026. 40:13 40 minutes, 13 seconds We are proud to share two domain specific solutions which we have co-inovated with our partners. First leveraging the full stack Nvidia AI 40:21 40 minutes, 21 seconds platform that empowering biioarma companies with production grade agentic systems for molecular simulation and 40:27 40 minutes, 27 seconds virtual screening. And second with data bricks we have launched merchant risk management solution to help financial institutions and payment providers gain 40:36 40 minutes, 36 seconds realtime visibility across the merchant life cycle. Lastly, our MD and chairman Dr. Anand Desh Pandesh received two 40:44 40 minutes, 44 seconds lifetime achievement awards during the quarter. The CNBC TV18's award at the India Business Leader Awards 2025 and at 40:52 40 minutes, 52 seconds the Star Awards 2026 event organized by software exports association of Pune. With this let me hand it back to Sep. 41:02 41 minutes, 2 seconds Operator let's open for Q&A. Thank you so much. 41:10 41 minutes, 10 seconds We will now open the call for Q&A session. We will wait for a few minutes until the queue assembles. We request participants to restrict to two 41:18 41 minutes, 18 seconds questions and then return to the queue for more further questions. 41:22 41 minutes, 22 seconds Please raise your hand from the participant tab on the screen and ask the question. 41:33 41 minutes, 33 seconds The first question is from Ma Babik. 41:38 41 minutes, 38 seconds Hi, thank you. So a couple of questions firstly sep can you talk about how are you seeing the demand environment currently versus let's say 3 months ago 41:47 41 minutes, 47 seconds given the headlines from geopolitics as well as you know how enterprises are adopting to you know generative AI any color on the demand environment will be 41:55 41 minutes, 55 seconds useful and secondly just from a next year perspective you had is you know target of reaching $2 42:02 42 minutes, 2 seconds billion by F27 along with some margin expansion so are you sticking to that or do you want to make some changes to be 42:09 42 minutes, 9 seconds given how the macro is playing out right now. 42:13 42 minutes, 13 seconds Yeah. So as far as the macro is concerned, look uh this war situation in the Middle East, there are two parts to 42:20 42 minutes, 20 seconds it. One, it does not directly affected affect us from the Middle East perspective because we have zero to very 42:27 42 minutes, 27 seconds little exposure in Middle East. But as far as the bigger thing is concerned if it goes on for more time then obviously you know it is a issue because oil 42:35 42 minutes, 35 seconds prices remaining higher for long will have an impact on the inflation etc. 42:39 42 minutes, 39 seconds that will affect the entire sector not just us and within that we are confident with our you know progress in AI with the investments that we are doing we'll 42:47 42 minutes, 47 seconds continue to gain market share but we'll be cautiously optimistic as far as that is concerned in terms of your last question and then I'll come back to the 42:55 42 minutes, 55 seconds enterprises side the $2 billion by FI27 that's a run rate we are marching towards it steadily and again look if 43:01 43 minutes, 1 second the macro goes in a different direction going ahead we'll tackle it as it comes but otherwise the run rate wise we confident we are marching towards it 43:10 43 minutes, 10 seconds steadily and we'll get there plus minus a quarter at worst. Now as far as the enterprise adoption is concerned my colleagues Nitish as well as Bhat talked 43:19 43 minutes, 19 seconds about the different case studies. Nitish talked about how we are taking it in the healthcare sector in some cases and in the engineering side where the tech 43:28 43 minutes, 28 seconds companies they are the fastest one to adopt. The demand that we are seeing from them in terms of AI le software development life cycle is the highest. 43:36 43 minutes, 36 seconds Healthcare life sciences BFSI which are the other two segments for us are regulated industries. it is picking up although I will say the P or pilot to 43:44 43 minutes, 44 seconds the enterprisewide adoption it is going slower than what would be there in a text sector. So hopefully that answers. 43:53 43 minutes, 53 seconds Yeah thank you. 43:57 43 minutes, 57 seconds Thank you. The next question is from Abhishek Patak. 44:04 44 minutes, 4 seconds Yeah. Hi. Am I audible? Hello. Yeah, you are audible please. 44:11 44 minutes, 11 seconds Yeah. Yeah. Hi, hi. Hi, Sundep. Uh, thanks for the opportunity. Sundep, a couple of questions. Um, firstly, on the top five accounts, uh, they were just 44:18 44 minutes, 18 seconds slightly soft this quarter. Uh, if you could just guide us which vertical um, sort of, you know, contributed to the softness amongst the top five clients 44:26 44 minutes, 26 seconds and, uh, sort of, you know, what's the outlook uh, you know, whether it's BFS or or or healthcare or high-tech that will be quite helpful. Uh, and the 44:34 44 minutes, 34 seconds second question just clarification on the 2 billion run rate. Uh so so essentially we are we're talking about a quarterly annualized rate and not 44:41 44 minutes, 41 seconds necessarily FI272 billion in revenue. Is that correct? 44:44 44 minutes, 44 seconds Correct. So on the in the last part if the FI27 Q4 exit is where we are looking at the run rate being in the range of 44:52 44 minutes, 52 seconds $500 million or so. And now coming to your other question in terms of the top five accounts our top five accounts have two financial services accounts, one 45:00 45 minutes tech, one healthcare licenses. Now obviously you know these accounts have been ramping up fairly nicely for the last several quarters and if I may say 45:08 45 minutes, 8 seconds several years. Now when you do larger deals when you work with larger customers you also promise them cost savings and as a part of that there is 45:16 45 minutes, 16 seconds offshuring that you do over a period of time. So I I would not be reading anything much into it and from a company perspective uh you know we have fairly 45:24 45 minutes, 24 seconds strong relationships with each of these and they have scaled very nicely. So nothing to worry in that. Understood SEP and just lastly uh you know wanted to 45:31 45 minutes, 31 seconds get your thoughts on uh Salesforce headless 360 considering we are actually quite tight with Salesforce they've kind of you know come up with this whole sort 45:39 45 minutes, 39 seconds of you know headless 360 framework where the API is the interface right uh just understand how are we looking at this and does this kind of mean that over the 45:47 45 minutes, 47 seconds long-term value acrews away from let's say system integrators or IT services companies towards just uh you know uh the the OEMs or or or is there a 45:56 45 minutes, 56 seconds different perspective which allows us to retain um you know some value in this in this whole agentic era as well. 46:02 46 minutes, 2 seconds Yeah. So I'll be short given we have only 15 minutes in this call but if you look at the overall situation the 46:09 46 minutes, 9 seconds headless 360 while it gives the customers the options to use the agents from anywhere through the APIs and so on. It also increases the work not every 46:17 46 minutes, 17 seconds customer is that techsavvy to be able to you know take advantage of these without having the help from an SI. So we are we 46:25 46 minutes, 25 seconds are pretty closely working with Salesforce. We look forward to the increased time because of that as well in the current installed base and in the 46:32 46 minutes, 32 seconds newer customers as well. But happy to have an offline conversation to go into much more detail. Thank you so much. All the best. 46:40 46 minutes, 40 seconds Thank you. The next question is from Pratik Maheshwari. 46:49 46 minutes, 49 seconds Hi Sanit. U thank you for the opportunity. Uh so again my question is regarding articles. So just on your 46:57 46 minutes, 57 seconds health healthcare vertical u this quarter it's grown grown very uh strongly bottom quarter but uh uh see 47:05 47 minutes, 5 seconds some of the uh your larger peers have seen some weakness especially in their top uh pair accounts right and uh so 47:12 47 minutes, 12 seconds just wanted to understand some of that exposure is also to you guys just wanted to understand if you guys would have seen any any of such business reductions or is there any risk uh going on ahead? 47:24 47 minutes, 24 seconds Yeah. So, so look we play in the same ecosystem and some of our larger customers are where we share the customers with a few other strategic you 47:32 47 minutes, 32 seconds know tier ones as well. Now as far as we are concerned we have been able to grow in the same set of accounts despite the 47:39 47 minutes, 39 seconds headwinds that all of us have faced and so to that extent uh you know that also shows the strength of the offering the strength of the relationship. I won't 47:47 47 minutes, 47 seconds read too much into that from our perspective. 47:51 47 minutes, 51 seconds Okay. And u just the second question was on on just your geo outlook this quarter we have seen India growing very strongly 47:58 47 minutes, 58 seconds probably North America grew at the company growth rate but Europe we had seen decline for the last two quarters so just if you could share your thoughts 48:06 48 minutes, 6 seconds uh right now what's what you're looking at yeah the India part is an aberration the thing that happened there is one of our 48:14 48 minutes, 14 seconds IP customers in our accelerite business the renewal happened in rupee terms through their GCC so that basically had 48:21 48 minutes, 21 seconds to be since it was built in GCC and rupee terms that had to be classified as India revenue otherwise the North America revenue would have been even higher and the India revenue would not 48:29 48 minutes, 29 seconds be where it is so nothing nothing to read there in terms of an India based thing and it'll get corrected in the next quarter and you will see it as far 48:37 48 minutes, 37 seconds as Europe is concerned that's an area where we want to double down and there are some customers and takes that happen and that is what it is so that was a 48:46 48 minutes, 46 seconds decline of 1.8% 8% sequentially but the India part and the North America part are adjustments. 48:53 48 minutes, 53 seconds Okay. Thank you so much. 48:56 48 minutes, 56 seconds Thank you. The next question is from Girish Pai. Yeah. Am I audible? 49:04 49 minutes, 4 seconds Yes, please. Yes. 49:06 49 minutes, 6 seconds Yeah. Thanks for the opportunity. Um so, uh PE channel has been one critical channel for you. Uh what is the company's exposure to this channel? Uh 49:15 49 minutes, 15 seconds now with all the SAS talk of SAS apocalypse, how does this impact demand outlook from this channel for FI27 and beyond? That's my first question. 49:24 49 minutes, 24 seconds Yeah. So the company exposure to PES and again you know PE channel gets the business in some cases and the other 49:32 49 minutes, 32 seconds part which we classify in PES is the customer is owned by and the fact is that there are more PE owned companies in the US today than public companies 49:40 49 minutes, 40 seconds and if you look historically especially in the enterprise software space in the last four five years many companies have been taken from public to private by 49:48 49 minutes, 48 seconds private equity so that doesn't mean that they are small or they are you know financially weak or anything like that. 49:54 49 minutes, 54 seconds Now as far as Saspocalypse is concerned there is that's an opportunity for people like us if we can partner with the PES and their portfolio companies 50:01 50 minutes, 1 second and improve their margins by using our platforms like SASA whether we use our opensource LLM tuned by us or we use 50:10 50 minutes, 10 seconds entropics of this world and otherwise it's a very big opportunity and that's the reason we have invested in bringing a senior leader to lead that who has dealt with enterprise software at scale 50:18 50 minutes, 18 seconds in the past. So we are actually looking at this as a positive for us helping our customers reduce cost while delivering 50:25 50 minutes, 25 seconds more and using technology to do that lesser of headcount more of technology. 50:30 50 minutes, 30 seconds So that's where it is and it's it in our mind is a good growth market for us. 50:36 50 minutes, 36 seconds My second and last question how much was the license fee booked in the fourth quarter and how much has been the incremental capitalization of spending 50:44 50 minutes, 44 seconds on building platforms in the current quarter in the fourth quarter of FI26. This is a question for Venit. Venit. 50:51 50 minutes, 51 seconds Yeah. So license V we are called we don't specifically call it out uh you know in terms of because it is a combination of both our own internal IP 51:00 51 minutes as well as the external IP that has been outed as part of the largest services contract. So but we can tell you that 51:07 51 minutes, 7 seconds our our own developed IP does definitely get a lot of attention and momentum in terms of uh the the benefits that it 51:16 51 minutes, 16 seconds provides to our client. it is definitely on the track and as far as the as far as the intangible uh uh sort of uh uh uh 51:25 51 minutes, 25 seconds spend that we do on annual basis it's in the range of around uh it's in the range of around 8 to9 million a year 51:33 51 minutes, 33 seconds okay thank you thank you next question is from Kumar 51:40 51 minutes, 40 seconds Rakkesh Hi, good evening and thank you for 51:50 51 minutes, 50 seconds taking my question. Sundep, my first question was on the revenue mix um or or revenue model for your billing to clients. I understand it would be a 51:59 51 minutes, 59 seconds combination of your own IP SAS platform and other platforms uh some of the third party platforms and the employees. How 52:07 52 minutes, 7 seconds does the mix between our own platform and third party platform moves quarteron quarter? The reason I'm asking this is that for the last couple of years we 52:15 52 minutes, 15 seconds hadn't seen much of seasonality in the revenue growth of the company. But should we expect given the base where we have reached that there could be some 52:23 52 minutes, 23 seconds seasonality which may start coming in especially when I'm looking at third party uh software in this quarter was higher than the last quarter and should 52:31 52 minutes, 31 seconds we start preparing for some of the seasonality especially how the mix between third party platform and our platform moves from one quarter to another. 52:41 52 minutes, 41 seconds Yeah. So, so look uh if you know persistent historically our seasonality was also linked to some of the outcome based pricing that we had with one of 52:49 52 minutes, 49 seconds our top customers and that top customer today from that perspective has come down in percentage revenue and we we work very hard to get out of that 52:57 52 minutes, 57 seconds system. Now as far as the forward-looking things are concerned whether it is SASA or our other IP like IO geni hub or using let's say an 53:06 53 minutes, 6 seconds entropic under the hood for delivering you know programs or open AI or something else you know those will be 53:13 53 minutes, 13 seconds part of services engagement so we do not expect much of a seasonality because of that it will be you know basically a 53:20 53 minutes, 20 seconds part of our scaling up the AI initiative so I wouldn't read too much into this 53:28 53 minutes, 28 seconds Got that. And from the third party platform which you referred to say from Anthropic, if we start using some of 53:34 53 minutes, 34 seconds their platform, how does that changes our growth profile and more importantly the the margin profile for for the business? Are we largely neutral from 53:43 53 minutes, 43 seconds that perspective or we are confident that our own platform would be good enough and that mix doesn't dramatically changes between own platform versus third party platform? 53:53 53 minutes, 53 seconds Yeah. So see the reason you have your own platform and you partner with third parties and adopt the third party platforms whether for software 54:00 54 minutes development life cycle that could be anthropic that could be an open AI codex that could be gemini that could be copilots etc etc it's to basically work 54:09 54 minutes, 9 seconds with customers who choose these platforms and we as a software services or tech services provider have to be able to offer those choices work with 54:18 54 minutes, 18 seconds customers who have already invested or have you know other reasons for using these platforms. So from that perspective if we get a free hand we 54:27 54 minutes, 27 seconds work with let's say enterprise software company we are allowed to use whatever we use we may use open source in other cases we may use these we pay for the 54:34 54 minutes, 34 seconds tokens for what we consume at times they may be given by the customers at times we may be paying for that depends on what the business model is and most of 54:44 54 minutes, 44 seconds these things should be margin neutral or accretive because if we use technology we should be able to do more work with lesser people and more technology. 54:53 54 minutes, 53 seconds That's the entire promise of AI. And with that, it should not be margin decretive. So don't worry about the margin going down. It'll be the same or 55:02 55 minutes, 2 seconds better as we use more of this technology to deliver to our customers. Got it. Thank you. 55:11 55 minutes, 11 seconds Thank you. The next question is from Nitin Padman. 55:25 55 minutes, 25 seconds Yeah. Hi, good evening. 55:27 55 minutes, 27 seconds Yeah. Yeah. Evening. Thank you for the opportunity. Uh two questions. So one is I think last year uh as we entered the 55:34 55 minutes, 34 seconds year we basically called out that growth will be led by BFSI followed by high-tech followed by healthcare. How are you seeing the shape of growth as we 55:43 55 minutes, 43 seconds get into the next year? Um the second is uh when we look at the OPD business 55:49 55 minutes, 49 seconds overall uh uh considering SDLC has come down the life cycles have come down how should we think about cannibalization 55:58 55 minutes, 58 seconds rates there and what is the nuances uh and how are you thinking about that? 56:03 56 minutes, 3 seconds Yeah. So as far as the next year is concerned the pecking order would be between healthcare life sciences and BFSI at the top one of these two they 56:12 56 minutes, 12 seconds are very close neck to neck from what we see today and things can change but the other one will be so between one and two 56:19 56 minutes, 19 seconds will be healthy accesses BFSI forward and again this is what we see today this is no guidance etc please don't read too much into it we don't give forward looking guidance this is just 56:28 56 minutes, 28 seconds directionally what we are seeing now the OPD part it's an interesting play the best part here is we are pretty strong in tech and tech is the one which is 56:37 56 minutes, 37 seconds adopting these technologies because they're also creators of these technologies and they're not regulated. 56:42 56 minutes, 42 seconds So they are more aminable to taking these into production and so on and the learnings from there should be very very valuable for us. We may see compression 56:50 56 minutes, 50 seconds in the tech world and even if that happens to the extent that we will also go and cannibalize our own business there's enough and more business that is 56:58 56 minutes, 58 seconds there from a time perspective and we are a very very small company at $1.7 billion roughly we are very very small 57:05 57 minutes, 5 seconds in this and there is enough new outsourcing that may happen from these tech companies and much more than that there will be market share rotation 57:12 57 minutes, 12 seconds between people and hopefully we'll be leading the pack. So uh just quickly u 57:18 57 minutes, 18 seconds so in your experience u well these are very early adopters uh despite the fact that there's a 57:26 57 minutes, 26 seconds cannibalization on the SDLC side you are still seeing a higher net is that your experience so look I don't want to give you 57:33 57 minutes, 33 seconds forwardlooking guidance all I can say is no no so far yeah so far so far yes we have been you know able to deliver more value and get 57:42 57 minutes, 42 seconds more in return but there may be there may be a time when tech for a quarter two three and I 57:49 57 minutes, 49 seconds am I'm not sure how this will pan out because anthropic and other people announce so many things so fast and these are really powerful tools in our 57:58 57 minutes, 58 seconds hands today so it may happen that tech may be compressed but again you know with that compression our if we are able 58:05 58 minutes, 5 seconds to win more business given that we are very closely working with many of them we should be able to come up winners but I don't want to give you any forward 58:14 58 minutes, 14 seconds guidance more than that no That's fair. Thank you so much and all the best. Thank you. 58:23 58 minutes, 23 seconds The last question is from the bore single. 58:30 58 minutes, 30 seconds Yeah. Hi. Uh thanks for uh taking my question uh and congrats on a great quarter yet again uh to the team. Uh Sep 58:38 58 minutes, 38 seconds and V just one quick uh questions from each of you. uh SEP from a growth point of view if I look at FI26 uh we probably had three challenges this year in terms 58:46 58 minutes, 46 seconds of a weak US macro uh the tariff uncertainty as well as geni now standing as we are when FI27 is about to start I think there is an additional overhang of 58:55 58 minutes, 55 seconds the war uh that we are seeing at this point of time so how are we looking at FI27 versus FI26 there are more challenges than we had probably seen 59:03 59 minutes, 3 seconds last year or some of the headwinds that we had seen let's say in terms of US we macro being weak or the geni deflation 59:10 59 minutes, 10 seconds those have kind come down to be able to maybe let's say give us some headroom to expand this year and venit a quick question on the margins front the 59:18 59 minutes, 18 seconds margins that we have delivered for this year at around 15 and a half 15.6%. 59:23 59 minutes, 23 seconds Uh going forward do we feel comfortable with the earlier margin guidance that we had said that we will probably look at around 16% margins itself. uh and over 59:31 59 minutes, 31 seconds and beyond that how are we looking at the trajectory from a next two-year point of view not just the quarterly but next two years how are we looking at the directionally in terms of margins 59:42 59 minutes, 42 seconds so from a market perspective you know look these things like the war etc are not in our control but one hopes that these things settle down soon and that 59:50 59 minutes, 50 seconds is good for everyone and hopefully this overhang should be behind us in the next few weeks if things go right from 59:58 59 minutes, 58 seconds whatever we see in the market now the rest of Other things look last five six years or more we have seen co we have 1:00:06 1 hour, 6 seconds seen bad macro good macro and so on and we as a company have always tried to build capabilities and be closer to our 1:00:12 1 hour, 12 seconds customers to be able to sail through this in a decent manner from what we see today we should be able to have a decent 1:00:21 1 hour, 21 seconds growth in the coming year we are building and investing in capabilities on the AI front and otherwise we are working very closely with partners 1:00:29 1 hour, 29 seconds whether it is the Nvidias of world whether it is entropics, open ais and the partners that matter in the data space like data bricks, snowflakes and 1:00:36 1 hour, 36 seconds so on. So from that perspective heads down building capabilities differentiated respected in the market and hopeful that the growth journey will continue with it. 1:00:46 1 hour, 46 seconds Yep. So we were uh see we have called out our margin trajectory I think. So right now we have achieved whatever we 1:00:54 1 hour, 54 seconds have set. Uh again that was not that's not a guidance. Uh it's a aspiration. 1:01:00 1 hour, 1 minute Our our aspiration continues to be in the 16 to 17% range. But remember in this environment our first priority is 1:01:07 1 hour, 1 minute, 7 seconds growth. Our first priority is uh investing back into business and developing capabilities. That's more important on the way. If we can maintain or improve our margins we'll do that. 1:01:19 1 hour, 1 minute, 19 seconds Got it. Got it. Thank you so much for taking my questions and wish you all the best. 1:01:22 1 hour, 1 minute, 22 seconds With that we will you know end the call with a message that you know the obvious thing is with all these technology changes there's an excitement in the 1:01:30 1 hour, 1 minute, 30 seconds market and hopefully you know we'll build the relevant capabilities and keep the growth in you. Thank you. 1:01:38 1 hour, 1 minute, 38 seconds Thank you very much to persistent management team. Ladies and gentlemen on behalf of persistent systems limited that concludes today's conference. Thank 1:01:46 1 hour, 1 minute, 46 seconds you for joining us and you may now disconnect your line and exit the webinar.