Coforge Share Price jumped by 10.47 percent, hold or sell, know the analysis of big investors
Coforge Ltd, a prominent player in the Indian IT services sector, has recently made headlines with its impressive financial performance for the second quarter of FY25. On October 23, 2024, the company’s shares surged by 12.30%, reaching a new 52-week high of Rs 7,632.75. This remarkable increase reflects strong investor sentiment following the announcement of its quarterly results.
Main Points
Financial Performance Highlights
Coforge reported a net profit increase of 35.6% year-on-year (YoY), amounting to Rs 255.2 crore. The revenue also saw a significant rise of 33% YoY, totaling Rs 3,062.3 crore for the quarter ending September 30, 2024. The company’s EBITDA margins improved by 53 basis points, reaching 15.8% during this period.
Order Intake and Client Growth
The company achieved an order intake of $516 million in Q2, marking the eleventh consecutive quarter with order intakes exceeding $300 million. This included three large deals and the addition of 13 new clients, showcasing Coforge’s robust market position and growth strategy. The total headcount reached 32,483, reflecting a net addition of 5,871 employees during the quarter.
Market Reaction and Target Price
Following these positive results, analysts have revised their outlook on Coforge shares. Sharekhan upgraded the stock to a “Buy” rating with a revised target price of Rs 8,480. This recommendation is supported by expectations of continued growth in the company’s organic business as it is projected to regain a strong growth trajectory in FY26.
As of October 23, 2024, Coforge’s shares were trading at approximately Rs 7,632.75, reflecting a substantial gain from previous sessions where it settled around Rs 6,795.60. The stock has demonstrated resilience and upward momentum over recent months, with notable performance metrics:
- 1 Week Gain: +3.24%
- 3 Month Gain: +27.72%
- 6 Month Gain: +28.82%.
Several factors contribute to the bullish outlook for Coforge:
- Strong Financial Results: The impressive YoY growth in both profit and revenue indicates robust operational performance.
- Consistent Order Intake: Sustained order intake above $300 million for eleven consecutive quarters suggests strong demand for Coforge’s services.
- Client Acquisition: The addition of new clients enhances revenue potential and market share.
- Positive Analyst Ratings: Upgrades from analysts like Sharekhan reflect confidence in the company’s future performance.
- Improved Margins: Expansion in EBITDA margins signals better cost management and operational efficiency.
- Dividend Announcement: The board has recommended an interim dividend of Rs 19 per share, which is attractive for income-focused investors.
