Now Reading: Coforge shares surge 10% on 49% profit jump in Q1
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Coforge shares surge 10% on 49% profit jump in Q1
Coforge shares rose over 10 per cent on Tuesday after the IT firm reported a 49.1 per cent year-on-year rise in consolidated net profit to Rs 531.7 crore for the first quarter…
The Story in Brief
Coforge shares rose over 10 per cent on Tuesday after the IT firm reported a 49.1 per cent year-on-year rise in consolidated net profit to Rs 531.7 crore for the first quarter of FY27. Revenue from operations climbed 49.2 per cent to Rs 5,527.7 crore, while EBITDA jumped 74 per cent to Rs 1,123.3 crore, with margins expanding 285 basis points to 20.3 per cent. The board declared an interim dividend of Rs 4 per share and approved setting up a subsidiary in China.
The company posted an order intake of $691 million in total contract value for the quarter. Its 12-month signed order book stands at $2.23 billion. Chief executive Sudhir Singh attributed the growth to AI-led capabilities, with 86 per cent of revenue coming from engineering, data and cloud services. The Encora acquisition has been fully integrated, and the company expects FY27 to be an exceptional year, he said.
The Indian Opinion
The earnings beat is impressive, but the narrative that every IT stock is a buy after one quarter ignores the concentration risk in AI-linked revenue. Coforge derives 86 per cent of income from AI-led services, a figure that sounds strong until you ask how much of that is truly generative AI versus legacy automation. Watch the next quarter's order book mix: if the $2.23 billion pipeline shifts toward consulting-heavy deals with longer billing cycles, the margin story may cool.
Source: thehindubusinessline.com
This story was synthesised by AI from the source linked above.
