Coforge: Ticking all the boxes

研报英文原文证据摘录

Coforge: Ticking all the boxes

, (91-22) 6157-3000.

• 1Q print - org revenue and margin beat. 1Q print was slightly behind JPMe

but ahead of consensus on revenues, up 22.3% CC QQ. The Organic business Quarterly Forecasts (FYE Mar)

beat at 1% QQ vs. flat expectations; excluding exited businesses, revenues Adj. EPS (Rs)

were up 5% QQ suggesting strong underlying momentum. Org CC rev growth 2026A 2027E 2028E

Q1 9.53 13.58A 17.29

was led by Healthcare & Hitech (11.6%) followed by Insurance (4.6%), BFS Q2 11.07 14.53 18.37

(2.9%), Travel (1.7%). Signings were solid at $691m, up 6.5% QQ. Margins Q3 11.74 15.91 18.68

were ahead of JPMe/Street by 70/40bps overall. The primary disappointment Q4 19.68 18.32 19.96

was an earnings miss due to FX and finance costs. FY 52.01 62.28 74.31

• Strong growth outlook. Management continues to be bullish on growth going Style Exposure

forward on the back of strong deal wins and order book. It won four large deals

in 1Q. It won a $230mn net new five-year deal from a EU client last week that

will be part of 2Q order intake and will start ramping up from 2Q onwards,

providing near term visibility. It expects growth to be broad based across

verticals.

• Margins came in above guide. Ebit margins declined 60bps QQ to 16% due

to Encora consolidation but came ahead of JPMe/Street by 70/40bps and also

ahead of its full year guide of 15.5%. Org Ebit margins were largely flat at

16.7%. It has already rationalized G&A costs in Encora to some extent and

there is scope to further reduce these, which should help margins. It carried out

selective wage hikes in 1Q; however, for the broader employee base wage hikes

won’t happen at least before 4Q. The company now expects FY27 consol

margins to be 15.5%+ vs earlier guide of 15.5% as it expects to sustain the