In FY19, PSYS faced challenges in its top client, which impacted its Services and IP revenue. Consequently, 1 May 2019 revenue growth was tepid at 2.2% YoY, while EBITDA/PAT increased 38%/12% YoY in the year. Amidst the earnings softness, the uptick in payout to 92% (including INR2.25b buyback) was to some extent comforting. IP revenue (22% of the top line) was down 15% QoQ owing to seasonality and a weak performance from IBMs CE/CLM segment (more than 40% contribution to IP). Revenue from Services increased 2.3% QoQ and 26.5% YoY), well above our estimate of INR726m mainly due to the margin beat. appears to have bottomed out, expanding 230bp YoY to 17.8% (adjusted) in FY19 after two years of downtrend. 4QFY19 EBITDA margin shrank 230bp QoQ to 17.4% (adjusted for IL&FS; provisioning) driven by a dip in IP revenue, but was ahead of our estimate of 15.7% due to better pricing in linear services and write-back of bonus incentives.