Persistent Systems is trading higher on the back of its Q4FY21 earnings. The company reported an expansion in EBIT margins for the 5th quarter in a row.

Speaking to CNBC-TV18, Sandeep Kalra, ED and CEO of the company said that they are comfortable with EBIT margins in the range of 12-13 percent and expects EBITDA margins to be around 17 percent for the next 1-2 years.

“In the near future, for the next 1-2 financial years we would be very comfortable being in the 17 percent in terms of the EBITDA margins. We have made significant improvement even in the EBIT margins and we expect to be in the range of roughly about 12-13 percent EBIT going ahead. So, we are comfortable with the margins; the rest we will plough into growth,” he said.

Kalra said that clients looking to accelerate digital transformation has benefitted Persistent Systems. Going ahead, he is expecting a 3-4.5 percent revenue growth quarter-on-quarter (QoQ).

“We combined our expertise in digital product engineering with the domain expertise in different industries. That gave us the larger deals that has fueled our growth. As we go ahead, if you look at the quarter that just went by, we came in at 20.3 percent on the year. We have done reasonably good order bookings in the last few quarters and we expect to continue a growth between 3-4.5 percent QoQ going ahead,” he said.

He also said that the deal pipeline is reasonably robust and does not see a sequential decline in deal wins as a slowdown.

Kalra expects wage hikes to be higher than historical levels this year. He said that the FY22 wage hike cycle will be normalised effective July.

Watch the video for more.

(Edited by : Abhishek Jha)