Persistent Systems attracts 31.6% premium

Settles at Rs 408 on BSE

Shares of IT firm Persistent Systems settled at Rs 408 on BSE, at a premium of 31.61% over the initial public offer price of Rs 310.

The stock debuted at Rs 400, a premium of 29% over the issue price. On BSE, 92.30 lakh shares were traded on the counter. The stock hit a high of Rs 448 and a low of Rs 386.

The current price of Rs 408 discounts the year ended March 2009 EPS of Rs 16.7 by a PE multiple of 24.43.

The company had priced its initial public offer at the upper end of the price band of Rs 290 to Rs 310. The issue ended with an over subscription of 93.60 times on 19 March 2010. The IPO got bids for 50.73 crore shares compared with 54.19 lakh shares on offer.

The qualified institutional buyers (QIBs) category was oversubscribed by 144.42 times, the non institutional investors category was oversubscribed by 107.73 times and the retail investors category was oversubscribed by 21.68 times.

Persistent Systems plans to use the funds raised from the IPO for establishment of development facilities in Pune and Nagpur and to procure hardware.

Pune-based Persistent Systems caters to offshoring outsourced product development (OPD) market. It provides customised services to global software product firms and start-ups.

On a consolidated basis, the company reported a net profit of Rs 66.90 crore on sales of Rs 593.83 crore in the year ended March 2009.