Coforge (COFORGE) reported 4QFY23 revenue growth of 4.7% QoQ in CC terms, exceeding our estimates of 3.1%. Reported revenue stood at USD264.4m (up 5.0% QoQ/13.8% YoY). The growth was broad-based across verticals and service lines with Insurance and BFS leading the pack reporting 5.0% and 4.5% QoQ growth in CC, respectively, while TTH was up 2.3% QoQ during the quarter. Even the large deal wins during the quarter were strong with two new large deals of USD50m+ (each from BFS and Travel verticals). Although the Net New deal wins were flat YoY, the executable order book was robust at USD869m (+20.7% YoY). Management guided for the initial FY24 USD CC revenue growth of 13-16% YoY.
OutlookHowever, we believe the robust outlook is already factored into the price and we do not see any potential upside from hereon. Our TP of INR4,290 implies 22xFY25E EPS. We reiterate our Neutral rating on the stock due to fair valuations.
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