Persistent Systems' shares surged on the back of strong Q3 numbers. Speaking to Bloomberg TV India Persistent COO & Executive Director Mritunjay Singh said the fourth quarter could be even better with faster growth in the digital and newer technology segments. The acquisition of Ireland-based Aepona will help in increasing the business in telecom infrastructure and Internet of Things (IOT) product.

Persistent posted a stable Q3 earnings growth. Can you tell us more about the overall business environment?

The kind of business we are in, which is largely in the digital and newer technology, we have seen good improvement. And if you look at the growth that we have delivered, it was around 9.1 per cent on a quarter-on- quarter basis. And almost half of that has come from the organic growth and the remaining from the acquisition that we have done on the product that we find very interesting for the current and future market. Aepona, for example, as a product that we have acquired in telecom space which actually fits in the middle of telecom infrastructure and it can be potentially transformed into an Internet of Things (IOT) product and we have just launched that roadmap. So overall we see business environment improving for company like ours. We expect that to continue into the next year. Another interesting thing for us is that we have been focusing on enterprise business, which has been growing —currently it is at around 29 per cent of our business. Overall, the IP sector is growing by almost 34 per cent largely by acquisition. But the rest of the growth comes from existing products. Banking, Financial Services and Insurance (BFSI) has delivered almost 18 per cent growth, which is a very interesting play for us, and we expect that to continue to grow. So that's the overall colour. We expect to improve as we go in Q4.

What kind of growth do you anticipate for Q4 and FY17 as well?

First on the Q4, we are very confident on that and we have talked about 10-12 per cent growth for this year. As you recall, we had a Q1 which was flattish. So we are actually tracking that right now and we do not want to say anything more than that as it is too early to talk about the New Year’s growth. We do not give guidance or numbers. The market is very interesting now and the span on newer technology is expanding much faster. And that is a good sign for companies like us because we see that budget increasing. The overall budget for the companies could be flat but the segment in which we are operating is all digital technologies. And we all expect expansion in that side of the market.

As for the North American infrastructure, which is a major contributor to your revenue, what is your outlook on that vertical and geography?

If you look at the North American numbers, they are looking a little down because the other business that we have acquired has expanded. But the numbers have increased even in North America as well.

It is just in the percentage term that it is looking very different because the other businesses are growing faster and we expect that to continue. In the infrastructure sector which is the old software product company that we used to sell, we expect the business model to change. So we will see deals that are essentially about non-liner product take over kind of deal in that segment. We see that in the pipeline and we are excited about that sector as well. So I don't feel that sector is going down but is going to improve from here.

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