Buy Coforge; target of Rs 12000: Motilal Oswal

Motilal Oswal is bullish on Coforge has recommended buy rating on the stock with a target price of Rs 12000 in its research report dated January 23, 2025.

Broker Research

January 24, 2025 / 13:17 IST

BUY

26 Aug, 2025 12:21

Volume

Todays L/H

Motilal Oswal's research report on Coforge

COFORGE reported 3QFY25 strong revenue growth of 8.4% QoQ in CC terms, above our estimate of 4.9% QoQ CC. Reported revenue stood at USD397m (up 7.5% QoQ/40.8% YoY). The company reported an order intake of USD501m in 3Q with four large deals, resulting in a robust 12-month executable order book of USD1.3b (+40% YoY). Adj. EBITDA (pre-RSU) margin came in at 17.8% (est. 18.8%). Adj. PAT stood at INR2.3b (flat QoQ/down 2.6% YoY). The M&A expenses were INR162m compared to 290m in 2QFY25. The company’s revenue/EBIT grew 28.7%/27.5% in 9MFY25, while PAT declined 8.3% vs. 9MFY24. We expect revenue/EBIT/PAT to grow by 52.0%/47.9%/48.5% YoY in 4QFY25. We reiterate our BUY rating on COFORGE with a TP of INR12,000, implying a 31% potential upside.

Outlook

We believe COFORGE’s strong executable order book and a rebound in BFS client spending bode well for its organic business. Cigniti could prove to be an effective long-term asset. We value COFORGE at 43x FY27E EPS with a TP of INR12,000, implying a 31% potential upside. We reiterate our BUY rating on the stock.

For all recommendations report, click here