IT services sector: Does the Persistent Systems/Nagarro deal reflect a new logic?

Research evidence excerpt

IT services sector: Does the Persistent Systems/Nagarro deal reflect a new logic?

30 June 2026

European Technology/Software

IT services sector: Does the Persistent Systems/Nagarro deal

reflect a new logic?

In our view, Persistent Systems’ acquisition of Nagarro (link, both not covered) is not Derric Marcon

+33 1 58 98 06 30 reflective of a new industrial logic. Indeed, we have often seen consolidation like this in

derric.marcon@bernsteinsg.com the IT services sector. While the profiles of the buyer and seller inevitably lend a unique

character to a transaction of this kind, the underlying logic is unsurprising – opening up

Richard Nguyen new avenues for growth, access to new clients, new vertical markets, new expertise and

+33 1 42 13 54 22

richard.nguyen@bernsteinsg.com complementary offerings, coverage of international clients across more geographies, and

revenue/cost synergies.

Specialist Sales

What strikes us most is what the acquirer is willing to pay for this listed asset, an IT services

Kiran Shah, CFA company with annual revenue of €1bn and 90% of its delivery resources in India, Romania

+44 20 3547 1533

kiran.shah@bernsteinsg.com and the Philippines. The price differs significantly from the valuation assigned by equity

investors, with a 140% premium being offered. The multiple implied by the deal (10.8x

EV/CY25 adjusted EBIT) is also substantially higher than the current multiples of many

other listed IT services firms (Exhibit 1). In our view, this again reflects equity investors’

excessive pessimism —a pessimism not shared by industrial entities: Alten (O, PT €135)/

Klanik; Accenture (NC)/Faculty; Infosys (NC)/Stratus/Optimum Healthcare; Cognizant

(NC)/3Cloud/Astreya) or the private equity firms associated with them (OpenAI Deployment

Company, Artefact).