Coforge has released its financial results for the first quarter of FY24, which fell below the expectations of analysts. While the company's revenues showed a year-on-year growth of 21 percent, reaching Rs 2,221 crore, they were still lower than the Rs 2,250 crore forecasted by CNBC-TV18. However, there was a 2.4 percent increase in revenue when compared to the previous quarter.

Share Market Live

NSE

Similarly, Coforge's earnings before interest and tax (EBIT) demonstrated a positive growth of 2 percent, amounting to Rs 230 crore. However, this figure was below the Street estimates of Rs 301 crore. EBIT margins also experienced a decline from 12.3 percent to 10.4 percent year on year, while analysts had anticipated 13.4 percent.

Despite these challenges, the company did achieve a net profit growth of 10 percent year on year, reaching Rs 165 crore, though it was lower than the predicted Rs 225 crore by CNBC-TV18.

On a positive note, Coforge reported a significant surge in order inflows, reaching an all-time high of $531 million. This remarkable achievement reflects a remarkable 76 percent increase quarter on quarter and an impressive 69 percent increase year on year.

Revenue from the US rose to Rs 1,103 crore versus Rs 938 crore year on year, while Europe, Middle East and Africa region grew 27 percent year on year to Rs 858 crore. The Asia Pacific region income stood at Rs 156 crore versus Rs 141 crore. Revenue from India stood at Rs 104 crore compared with Rs 76 crore in same quarter of last year.

Sudhir Singh, CEO & Executive Director, Coforge in an interaction with CNBC-TV18 on July 21 said it maintains its FY24 revenue guidance of 13-16 percent. This come in the context of peers like Infosys lowering guidance. Singh said "we will deliver on our guidance come what may and don’t see any scenario in which we will miss it". He added, "we have delivered on everything we have promised for the last 6 years".

The company has 12 months executable orderbook of $897 m, up 20 percent year on year and is keen to look at inorganic growth around data, cloud and new areas like healthcare. Using the mergers and acquisitions route, Coforge aspires to clock $2 billion revenue from $1 billion.

Nomura retains the stocks as the top mid cap pick with Rs 5,300 as the target price, while Motilal Oswal assigning Rs 4,460 as the target price, says Coforge's robust outlook is already factored in the price and do not see any potential upside from here.

Coforge shares are trading 0.5 percent higher on NSE on July 21 morning.

First Published:Jul 21, 2023 10:57 AM IST