Coforge: Strong show in 1Q

研报英文原文证据摘录

Coforge: Strong show in 1Q

Global Markets Research

Coforge COFO.NS COFORGE IN 28 July 2026

EQUITY: TECHNOLOGY

RatingStrong show in 1Q Remains Buy

Target price

Increased fromRevenue growth to accelerate, margin beat continues INR 1,860 INR 1,740

1QFY27 — strong performance across the board Closing27 July 2026price INR 1,528

Coforge’s 1QFY27 revenue grew 1.1% q-q in constant currency (cc) terms (organic vs our

expectation of 0%). Excluding the exited India government and data center business, the Implied upside +21.7%

growth was 5.1% q-q in cc. Encora numbers were consolidated for two months in 1Q. EBIT

margin at 16.7% (organic, +20bp q-q vs our expectation of 16.5%) was also strong. OCF Market Cap (USD mn) 7,056.8

was at ~USD58mn (~48% of EBITDA) and FCF was USD73.7mn (95% of PAT). ADT (USD mn) 59.8

Strong, executable order book gives comfort on revenue growth outlook

Relative performance chartDeal wins (only in organic business) were USD691mn (+36% y-y). Executable order book

over the next 12 months was up 45% y-y to USD2.22bn. Coforge noted the deal wins and

order book do not include framework agreements (large contracts) from UK public services

which would be adding to growth over and above the one derived from the order book. 2Q is

likely to have strong deal wins, as per management, and it continues to aim for faster-than-

industry growth in FY27E. We think Coforge is likely to post ~4% q-q growth over 2Q-4Q

FY27F. Overall, we expect core organic growth for Coforge to be ~13% in FY27F (vs 11%

expected earlier).

Margin improvement to continue with synergies extraction from Encora and growth

Coforge management noted that one of the key reasons for continued margin expansion

is using AI as a key part of the solutions being sold to clients. For more details on