Coforge shares extend gains; check latest target prices post Q1 results

Shares of Coforge Ltd extended their upward run for the fourth consecutive session on Wednesday. The stock was last seen trading 2.02 per cent higher at Rs 1,719.60.

Following its Q1 earnings, Motilal Oswal Financial Services Ltd (MOFSL) said, "Coforge reported Q1 revenue growth of 1.1 per cent QoQ in CC terms, above our estimate of flat QoQ CC. The company reported an order intake of $691 million (up 36.3 per cent YoY) in Q1 with four large deals. Consolidated EBIT margin stood at 16 per cent, above the consensus estimate of 15.6 per cent. Consolidated adjusted PAT stood at Rs 560 crore (down 14.4 per cent QoQ and up 83.2 per cent YoY) vs. the consensus estimate of Rs 540 crore."

It added, "Our PAT estimate of Rs 510 crore reflects only the organic business and is, therefore, not directly comparable, as the reported results include Encora's contribution and the higher post-acquisition share count. Q1 FY27 revenue/EBIT/adj. PAT grew 49.2 per cent/80.8 per cent/83.2 per cent YoY. In Q2 FY27, we expect revenue/EBIT/adj. PAT growth of 57 per cent/82.2 per cent/70.4 per cent YoY in INR terms."

MOFSL maintained its 'Buy' rating on the stock with a revised target price of Rs 2,200.

JM Financial noted that Coforge's revenue and margins were ahead of its estimates. "We are revising FY27E–29E EPS by 6–9 per cent, incorporating Q1 FY27 results and Encora integration. We have revised the target multiple to 25x Mar'28E (earlier 24x) given near-term growth visibility, yielding a revised TP of Rs 1,795 (earlier Rs 1,610). Valuations are at ~24x FY28E consensus EPS; maintain ADD," it stated.

Equirus Securities kept its 'Long' rating with a September 2027 target price of Rs 1,930 (earlier Rs 1,410).

Nuvama Institutional Equities noted, "We are upgrading FY27E/28E EPS (+4.7 per cent/+3.4 per cent) on better margins. Retain 'BUY' with a TP of Rs 2,350 (earlier Rs 2,200) valuing it at 32x FY28E PE. The stock currently trades at 23x FY28 PE."

Meanwhile, Elara Capital downgraded the stock to 'Reduce' from 'Accumulate' as it don't see much of an upside after the recent sharp run-up in the stock price. It pegged the stock at Rs 1,750.