Coforge Share Price Surges 11% After Strong Q2 Earnings

Shares of Coforge rose nearly 11% in early trading on 23 October, following the company's impressive Q2 earnings report. By 10.35 am, the stock was trading at Rs 7,607 on NSE, reflecting positive investor sentiment driven by strong quarterly performance and growth outlook.

Q2 Financial Highlights

Coforge posted a net profit of ₹255.20 crore in the September quarter up 9% from ₹234.60 crore in the previous quarter. Revenue also saw a substantial rise, growing 27.5% sequentially to ₹3,062 crore compared to ₹2,401 crore in the April-June period. The earnings boost was partly attributed to Coforge's recent acquisition of Cigniti Technologies which added to its overall growth.

Coforge’s total order intake for Q2 stood at $516 million driven by three large deals. This marks the eleventh consecutive quarter where the company has secured orders exceeding $300 million. The firm’s order book which will be executed over the next 12 months grew to $1.3 billion, a 40% increase year on year. Additionally, Coforge onboarded 13 new clients during the quarter further bolstering its future business prospects.

Despite strong revenue and profit growth, Coforge’s EBIT margin declined by 190 basis points sequentially primarily due to adjustments related to the Cigniti acquisition. The organic EBIT margin for the quarter was 12.2% compared to 13.6% in the April-June quarter.

Coforge saw an increase in its workforce adding 5,871 employees to bring the total headcount to 32,483. This includes 4,430 employees from its recent acquisition of Cigniti Technologies, while the company organically added 1,441 employees during the quarter. Attrition rates also improved dropping to 11.7%, a 130 basis point improvement compared to last year.

Recently Coforge's board approved a second interim dividend of ₹19 per share with 11 October marked as the record date.

Also read COFORGE Q2 Results

Management Outlook

Coforge's management remains optimistic about the company's future growth. CEO Sudhir Singh highlighted several positive indicators including 27% sequential dollar growth, a 6.3% increase in organic business, EBITDA expansion and a strong pipeline of large deals. We expect strong and sustained growth in the upcoming quarters, Singh said in an exchange filing, further boosting investor confidence.

About Coforge Ltd

Coforge is a global IT services company specializing in digital transformation, technology solutions and business process outsourcing. With a strong focus on sectors like banking, insurance and travel, Coforge delivers customized solutions that enhance efficiency and innovation for its clients. The company’s capabilities span cloud services, artificial intelligence, automation and data analytics. Headquartered in India, Coforge has a global presence with offices across key markets. Recent growth has been driven by acquisitions including Cigniti Technologies and a consistent stream of large deals. Coforge is known for its robust order book, expanding workforce and client centric approach.