11 Jun 2025Closed
The Gulf expansion is being valued as new growth when it is largely lower-margin work replacing hiring capacity that would otherwise have gone to North American clients.
Technology & Communication
Systems Limited
Disclosure. I hold SYS at 18.5% of the portfolio, since 18 Feb 2026.
What actually moves this business
- What it charges in dollars
- Most revenue is billed abroad, so a falling rupee lifts reported growth without anything improving operationally.
- What it pays its engineers
- Salaries reset in rupees, and they have been resetting upward faster than headline inflation.
- Whether the Gulf work carries the same margin
- Gulf contracts have been won at lower rates than the North American book they are displacing.
The view
18 Feb 2026Openhigh convictionThe currency tailwind that has flattered four years of margin is being quietly eaten by wage inflation, and the reported growth rate is a worse guide to the next three years than the falling net margin is.
What would prove me wrong
- Net margin stabilises above 12% for four consecutive quarters while revenue growth stays above 15%.
- Employee cost as a share of revenue falls year on year while headcount grows.
Previous views on SYS · 1
Five-year history
| Period | Revenue | Net income |
|---|---|---|
| FY2023 | PKR 85.4bn | — |
| FY2024 | PKR 108.9bn | — |
| FY2025 | PKR 126.3bn | PKR 14.1bn |
Sources
Page numbers are given so a reader can check a figure without reading a whole annual report. If a number on this page is not traceable to something below, it should not be on this page.
Systems Limited — Annual Report 2025
Systems Limited · 27 Mar 2026 · pp. 64–71 (segment and geographic revenue), p. 96 (employee costs)
Figures on this page last checked against a filing on 28 Jul 2026.
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