Coforge Ltd
Coforge Ltd
Information Technology F&OCoforge is an IT services company providing end-to-end software solutions and services. . It is among the top-20 Indian software exporters. Prominent global customers include British Airways, the ING group, SEI Investments, Sabre, and SITA. Over the years, Coforge has set up subsidiaries in the US, Singapore, Australia, UK, Germany and Thailand, mainly to market and mobilise projects for the software division. The company has business partnerships with large IT companies across the world.
Coforge offers compelling growth with 36% TTM sales growth, 105% TTM profit growth, and a consistent 21% ROE, supported by 72% analyst buy ratings. However, at a PE of 36.5x and a 20% stock price decline over the past year, investors should be mindful of valuation compression risks.
Key Fundamentals
MidcapComputer Software & ConsultingInformation TechnologyTechnical Indicators
Key Insights
Strengths
6- Company has reduced debt.
- Company is almost debt free.
- Company is expected to give good quarter
- Company has delivered good profit growth of 28.4% CAGR over last 5 years
- Company has been maintaining a healthy dividend payout of 43.1%
- Company's median sales growth is 18.4% of last 10 years
Weaknesses
1- Tax rate seems low
Growth Rate
AI Analysis — Bull vs Bear
anthropic claude-opus-4.6 3d agoCoforge offers compelling growth with 36% TTM sales growth, 105% TTM profit growth, and a consistent 21% ROE, supported by 72% analyst buy ratings. However, at a PE of 36.5x and a 20% stock price decline over the past year, investors should be mindful of valuation compression risks.
- Outstanding TTM revenue growth of 36% significantly outpaces mid-cap IT peers, indicating strong deal wins and execution
- TTM profit growth of 105% demonstrates exceptional operating leverage and margin expansion
- Consistent ROE of 21% over 5 and 10 years reflects high-quality capital allocation and durable competitive advantages
- Company is almost debt-free, providing financial flexibility for acquisitions and organic investments
- 72% of 32 analysts rate the stock a Buy, reflecting broad institutional confidence in the growth trajectory
- 5-year compounded sales CAGR of 29% and profit CAGR of 28% demonstrate sustained long-term growth momentum
- Healthy dividend payout ratio of 43.1% with 0.81% yield provides income even in a growth stock
- 10-year stock CAGR of 30% shows long-term wealth creation track record despite recent correction
- PE of 36.5x is elevated relative to sector average, leaving limited margin of safety if growth decelerates
- Stock has declined 20% over the past 1 year, indicating significant near-term sentiment weakness and potential de-rating
- Only 12.5% sell ratings but 15.6% hold ratings suggest not all analysts are fully convinced at current levels
- Low tax rate flagged as a concern — any normalization to statutory rates could compress net profit by 5-10%
- Price-to-book of 2.4x while reasonable, combined with 36.5x PE, implies the market is pricing in sustained high growth that may not materialize
- Market cap of Rs 50,226 Cr for a mid-cap IT firm implies expectations of continued large deal wins which carry execution risk
- 3-year stock CAGR of only 17% versus 31% profit CAGR suggests market has already started de-rating the stock
This is AI-generated analysis, not financial advice. Do your own due diligence.
AI News Digest
anthropic claude-opus-4.6 1d ago- Motilal Oswal ₹1,900 Buy target Jun 17
Motilal Oswal set a ₹1,900 target price (30% upside) after Analyst Day, citing management's $5B revenue target by FY30 (19% CAGR) and large-deal win ratio improving to 47% in FY26 from 38% in FY25.
- CLSA High-Conviction Outperform ₹2,075 Jun 5
CLSA maintained High-Conviction Outperform with ₹2,075 target, citing robust FY27 growth, AI-led margin expansion, and Encora revenue synergies expected from Q3 FY27.
- Nexa Agentic AI Platform launch Jun 2
Coforge launched the Nexa Agentic AI Platform for global insurers with 30+ AI assets and six flagship orchestrators; shares surged 4.29% on the news and gained 34% in the prior month.
- Pega Award for public sector Jun 9
Coforge won the Pega Industry Excellence Award for Government and Public Sector transformation work for a Scotland telehealth provider.
- Morgan Stanley Overweight ₹1,500 Jun 17
Morgan Stanley maintains Overweight with ₹1,500 target, projecting ~15% organic CAGR aligned with historical trends.
- Nomura Buy with ₹1,600 target Jun 16
Nomura maintained Buy on Coforge with ₹1,600 target, implying 42% upside from ₹1,122.30 closing price.
- IT index rallies 2.8% in two days Jun 16
Nifty IT rose 2.8% over two sessions on easing crude concerns and US-Iran deal hopes; Coforge gained 4.59% in the move.
- ₹28.80 Cr block trade on NSE Jun 8
Institutional block trade of ~2.01 lakh shares at ₹1,431 per share totaling ₹28.80 crore on NSE.
- ₹15.98 Cr block trade on NSE Jun 19
Block trade of ~1.11 lakh shares at ₹1,434.90 per share totaling ₹15.98 crore on NSE.
- Cigniti merger share allotment done Jun 3
Coforge allotted 1.26 crore shares to Cigniti shareholders in a 1:1 swap; paid-up capital rose to ₹88.53 crore.
- Investor Day 2026 presentation shared Jun 16
Coforge uploaded its Investor Day 2026 presentation to its website and disclosed it to exchanges under SEBI regulations.
- Board meeting for Q1FY27 results Jun 3
Board will meet July 27, 2026 to consider Q1FY27 results; trading window closes from July 1.
- Postal ballot for three directors May 29
Postal ballot initiated to appoint one independent director and two non-executive non-independent directors, with e-voting from May 30.
- No share encumbrance in FY26 Jun 9
Coforge disclosed it did not encumber any Cigniti Technologies shares during FY26 under SEBI takeover regulations.
TL;DR: Coforge is receiving strong multi-brokerage backing with Buy/Outperform ratings and targets ranging from ₹1,500 to ₹2,075, underpinned by an improving large-deal win ratio (47% in FY26) and a clear $5B revenue roadmap by FY30. The Nexa Agentic AI Platform launch and 75%+ AI pilots moving to production demonstrate execution on the AI monetization front. No material headwinds emerged in this period; institutional block trades and the Cigniti merger integration are proceeding smoothly. The trend is improving, with upcoming Q1FY27 results on July 27 as the next catalyst to validate the growth trajectory.
Quarterly Results
| Mar 2023 | Jun 2023 | Sep 2023 | Dec 2023 | Mar 2024 | Jun 2024 | Sep 2024 | Dec 2024 | Mar 2025 | Jun 2025 | Sep 2025 | Dec 2025 | Mar 2026 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Sales | 2,170 | 2,221 | 2,276 | 2,323 | 2,318 | 2,357 | 3,026 | 3,258 | 3,422 | 3,689 | 3,986 | 4,232 | 4,450 |
| Expenses | 1,874 | 1,915 | 1,935 | 1,928 | 1,929 | 2,048 | 2,603 | 2,823 | 2,895 | 3,112 | 3,253 | 3,508 | 3,574 |
| Operating Profit | 296 | 306 | 341 | 395 | 390 | 309 | 423 | 435 | 527 | 577 | 732 | 723 | 876 |
| OPM % | 14% | 14% | 15% | 17% | 17% | 13% | 14% | 13% | 15% | 16% | 18% | 17% | 20% |
| Other Income | -50 | 16 | 9 | 15 | 14 | 6 | 42 | 56 | 33 | 64 | 38 | -127 | -32 |
| Interest | 20 | 22 | 32 | 35 | 37 | 32 | 30 | 32 | 40 | 46 | 41 | 42 | 40 |
| Depreciation | 72 | 76 | 77 | 81 | 79 | 72 | 114 | 116 | 125 | 159 | 172 | 171 | 180 |
| PBT | 155 | 224 | 241 | 294 | 288 | 211 | 320 | 343 | 395 | 436 | 558 | 384 | 625 |
| Tax % | 25% | 22% | 22% | 18% | 20% | 34% | 27% | 25% | 22% | 18% | 24% | 23% | -7% |
| Net Profit | 117 | 176 | 188 | 243 | 229 | 139 | 234 | 256 | 307 | 356 | 425 | 297 | 666 |
| EPS in Rs | 3.76 | 5.41 | 5.88 | 7.71 | 7.24 | 3.99 | 6.06 | 6.45 | 7.81 | 9.49 | 11.23 | 7.47 | 18.23 |
Profit & Loss
| Mar 2015 | Mar 2016 | Mar 2017 | Mar 2018 | Mar 2019 | Mar 2020 | Mar 2021 | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Sales | 2,372 | 2,688 | 2,802 | 2,991 | 3,676 | 4,184 | 4,663 | 6,432 | 8,015 | 9,009 | 12,051 | 16,403 |
| Expenses | 2,036 | 2,214 | 2,322 | 2,489 | 3,026 | 3,459 | 3,882 | 5,330 | 6,733 | 7,562 | 10,357 | 13,467 |
| Operating Profit | 337 | 474 | 480 | 502 | 650 | 725 | 781 | 1,102 | 1,282 | 1,447 | 1,694 | 2,936 |
| OPM % | 14% | 18% | 17% | 17% | 18% | 17% | 17% | 17% | 16% | 16% | 14% | 18% |
| Other Income | -64 | 20 | 4 | 38 | 46 | 59 | 13 | 52 | 8 | 32 | 137 | -83 |
| Interest | 6 | 8 | 6 | 9 | 9 | 16 | 14 | 65 | 81 | 126 | 135 | 169 |
| Depreciation | 92 | 121 | 128 | 127 | 125 | 173 | 184 | 227 | 258 | 297 | 428 | 682 |
| PBT | 176 | 365 | 351 | 404 | 562 | 595 | 596 | 862 | 951 | 1,056 | 1,269 | 2,003 |
| Tax % | 31% | 21% | 22% | 24% | 25% | 21% | 22% | 17% | 22% | 21% | 26% | 13% |
| Net Profit | 122 | 287 | 272 | 309 | 422 | 468 | 466 | 715 | 745 | 836 | 936 | 1,745 |
| EPS in Rs | 3.74 | 8.83 | 8.15 | 9.12 | 13.06 | 14.21 | 15.04 | 21.73 | 22.72 | 26.14 | 24.29 | 46.33 |
| Div. Payout % | 51% | 23% | 31% | 33% | 0% | 44% | 17% | 48% | 56% | 58% | 63% | 9% |
Balance Sheet
| Mar 2015 | Mar 2016 | Mar 2017 | Mar 2018 | Mar 2019 | Mar 2020 | Mar 2021 | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity Capital | 61 | 61 | 61 | 62 | 62 | 62 | 61 | 61 | 61 | 62 | 67 | 67 |
| Reserves | 1,296 | 1,511 | 1,625 | 1,712 | 2,010 | 2,334 | 2,406 | 2,672 | 3,021 | 3,565 | 6,312 | 9,470 |
| Borrowings | 9 | 10 | 25 | 22 | 14 | 35 | 83 | 490 | 562 | 726 | 1,070 | 728 |
| Other Liabilities | 611 | 702 | 695 | 828 | 748 | 968 | 935 | 1,655 | 1,980 | 1,708 | 4,823 | 4,616 |
| Total Liabilities | 1,977 | 2,285 | 2,407 | 2,624 | 2,834 | 3,400 | 3,484 | 4,878 | 5,625 | 6,061 | 12,272 | 14,881 |
| Fixed Assets | 558 | 903 | 848 | 879 | 819 | 1,079 | 1,021 | 2,067 | 2,312 | 2,353 | 6,096 | 6,760 |
| CWIP | 120 | 17 | 0 | 1 | 1 | 0 | 0 | 17 | 5 | 23 | 2 | 3 |
| Investments | 55 | 75 | 316 | 365 | 365 | 14 | 12 | 0 | 0 | 0 | 146 | 0 |
| Other Assets | 1,243 | 1,291 | 1,244 | 1,379 | 1,649 | 2,307 | 2,451 | 2,794 | 3,309 | 3,685 | 6,028 | 8,119 |
| Total Assets | 1,977 | 2,285 | 2,407 | 2,624 | 2,834 | 3,400 | 3,484 | 4,878 | 5,625 | 6,061 | 12,272 | 14,881 |
Cash Flow
| Mar 2015 | Mar 2016 | Mar 2017 | Mar 2018 | Mar 2019 | Mar 2020 | Mar 2021 | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operating | 258 | 360 | 472 | 382 | 453 | 297 | 762 | 766 | 950 | 903 | 1,237 | 1,792 |
| Investing | -184 | -223 | -343 | -248 | -237 | 136 | -86 | -963 | -269 | -265 | -2,438 | -435 |
| Financing | -66 | -73 | -67 | -74 | -106 | -133 | -696 | -156 | -558 | -887 | 1,675 | -1,094 |
| Net Cash Flow | 7 | 64 | 62 | 60 | 109 | 300 | -20 | -353 | 123 | -249 | 474 | 263 |
| Free Cash Flow | 71 | 200 | 387 | 294 | 385 | 227 | 687 | 618 | 797 | 644 | 680 | 1,197 |
| CFO/OP | 104 | 97 | 120 | 98 | 88 | 66 | 119 | 93 | 96 | 88 | 96 | 76 |
Ratios
| Mar 2015 | Mar 2016 | Mar 2017 | Mar 2018 | Mar 2019 | Mar 2020 | Mar 2021 | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debtor Days | 93 | 80 | 61 | 71 | 58 | 75 | 84 | 79 | 73 | 73 | 78 | 88 |
| Cash Conversion Cycle | 93 | 80 | 61 | 71 | 58 | 75 | 84 | 79 | 73 | 73 | 78 | 88 |
| Working Capital Days | 48 | 64 | 38 | 30 | 37 | 38 | 33 | 33 | 13 | 30 | 18 | 25 |
| ROCE % | 19% | 25% | 23% | 23% | 30% | 27% | 25% | 32% | 31% | 29% | 20% | 24% |
Documents
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Company Information
Coforge is an IT services company providing end-to-end software solutions and services. . It is among the top-20 Indian software exporters. Prominent global customers include British Airways, the ING group, SEI Investments, Sabre, and SITA. Over the years, Coforge has set up subsidiaries in the US, Singapore, Australia, UK, Germany and Thailand, mainly to market and mobilise projects for the software division. The company has business partnerships with large IT companies across the world.