CLSA, a global investment bank, has expressed bullishness on two Indian IT companies, Persistent Systems and Tech Mahindra, citing potential upside of up to 27% following Accenture’s strong Q1 results. Accenture’s beat in Q1 2023 has sparked hopes of a similar performance from Indian IT majors like Persistent Systems and Tech Mahindra. CLSA believes that Accenture’s success is due to its focus on strategic client relationships, innovation, and cost management, which are also key strategies being adopted by Indian IT companies.
CLSA has set a target price of ₹1,350 for Persistent Systems, implying an upside of 21%, and ₹242 for Tech Mahindra, implying an upside of 27%. The brokerage firm cites Persistent Systems’ strong pipeline of deals and Tech Mahindra’s operational leverage as key factors supporting its optimism. Additionally, CLSA expects both companies to benefit from growing demand for digital transformation services and cloud-based solutions. Overall, CLSA’s bullish call on Persistent Systems and Tech Mahindra reflects the brokerage firm’s positive outlook on the Indian IT sector, driven by strong industry growth and improving profitability.