Coforge stock split, dividend: 47% upside? Analysts set up to Rs 11,000 targets post Q4 results

Coforge Ltd shares are in limelight on Tuesday after the IT major report a strong set of March quarter results, led by a higher-than-expected sequential growth in revenue, robust order inflows of $2.1 billion and an improvement in margin. The FY26 guidance was healthy, with the management seeing strong earnings visibility. This made a few brokerages believe a 20 per cent revenue growth and margin expansion are likely for the IT firm in FY26, as they suggested 'Buy' rating on the stock.   

Coforge reported a revenue growth of 3.4 per cent QoQ in constant currency (CC) terms, marginally higher than expectations of 3.2 per cent, driven BFS and travel verticals. 

Despite macro uncertainties, It remains confident of its FY26 growth trajectory, supported by a strong order book, a solid pipeline, and synergy benefits. For the quarter EBIT margin improved 123 basis points QoQ to 13.2 per cent and the management expects ESOP costs to decrease further, eventually reaching 100 bps of revenue starting
from 2HFY26. 

"The company sees a clear line of sight for improving margins over the next two years. Deal momentum continued to accelerate with the company reporting fresh order intake of $2.1 billion against $501 million in Q3 and the last eight-quarter average of $451 million. Its pipeline of large deals remain strong and unaffected as it expects them to close in the short term," Antique Stock Broking said. This brokerage maintained 'Buy' rating and kept its target unchanged at Rs 9,650 on the stock. 

MOFSL said Coforge’s recent deal with Sabre is a strong indicator that mid-tiers now have both the scale and the solution maturity to win cost-saving deals. 

"Among Tier-II players, our top pick is Coforge. Its strong offerings in BFS should enable it to participate in a demand recovery, and a strong TCV also indicates a robust near-term growth outlook. We believe Coforge's organic business is in great shape and Cigniti could prove to be an effective long-term asset," MOFSL said.

This brokerage values Coforge at 38 times FY27E EPS and suggested a target price of Rs 11,000, implying a 47 per cent potential upside.

Foreign brokerage Nomura said Coforge is its top pick in the mid-cap Indian IT services space. This brokerage has set a target price of Rs 9,730 on the IT stock.

"Coforge reported 32 per cent CC YoY growth in FY25—about 16 per cent organic—a solid industry-leading performance. Its strong deal-wins assure another 20 per cent-plus revenue growth year in FY26, which, coupled with margin expansion on lower ESOP costs, should yield a strong 25 per cent-plus earnings CAGR over FY25–27E. We maintain Coforge as our top pick in the sector reiterating our belief in its ability to build a strong business franchise over the next few years," Nuvama said. This brokerage suggested a target of Rs 9,400 on the stock. 

Coforge stock split, dividend
Meanwhile, along with its quarterly results, the IT firm also announced a fourth interim dividend of Rs 19 per share for FY25. The Board has fixed May 12 as the record date for the purpose of ascertaining the eligibility of shareholders for payment of fourth interim dividend. The payment of interim dividend would be made within 30 days from the date of declaration of dividend.   

Also,  Coforge fixed Wednesday, June 04 as the record date for determining the entitlement of equity shareholders for the purpose of split of existing equity shares of the company, such that existing one equity share having a face value of Rs 10 each into five shares of Rs 2 (Two) each, fully paid up, ranking pari passu in all respects.