India's Coforge stock on track for biggest jump in a year on upbeat outlook
· CNA · JoinRead a summary of this article on FAST.
Get bite-sized news via a new
cards interface. Give it a try.
Click here to return to FAST Tap here to return to FAST
FAST
May 6 : India's Coforge stock jumped as much as 11.1 per cent on Wednesday, on track to log its best session in more than a year, after the mid-tier IT firm forecast robust earnings and its margin beat surprised analysts.
The stock was trading 9.1 per cent higher at 11:15 a.m. IST, topping the Nifty IT index that rose 1.2 per cent. Shares have largely underperformed this year, dropping 24 per cent so far compared with a 22.4 per cent drop in the sub-index.
The company on Tuesday forecast earnings before interest, taxes, depreciation, and amortization growth of more than 20.5 per cent on a consolidated basis in FY27, while announcing that its March-quarter profit more than doubled from a year ago.
The forecast was sharply in contrast to larger peers Infosys and HCLTech outlooks of subdued growth as artificial intelligence-led spending caution and geopolitical tensions weigh.
CNA Games
Guess Word
Crack the word, one row at a time
Buzzword
Create words using the given letters
Mini Sudoku
Tiny puzzle, mighty brain teaser
Mini Crossword
Small grid, big challenge
Word Search
Spot as many words as you can
Show More
Show Less
"Coforge remains our preferred pick in the sector," said brokerage Jefferies, while hiking the target to 1,860 rupees from 1,620 rupees and reiterating a "buy" rating.
The brokerage said the results were a "clear positive surprise", citing a 230-basis-point sequential jump in earnings before interest and taxes margin to 16.6 per cent, driven by lower costs and operating leverage.
Strong deal wins and order-book growth provide visibility for double-digit organic growth, the firm said, even as Coforge trims its lower-margin India business.
Prabhudas Lilladher lifted its target to 2,020 rupees from 1,870, pointing to strong execution, steady revenue growth and sustained momentum in large deal wins.
Both brokerages said the margin improvement marks the start of a structural reset, supported by portfolio clean-up, cost optimisation and increased use of AI across delivery and operations.
Twenty-two of 30 brokerages, including Prabhudas Lilladher and Jefferies, rate the stock "buy" or higher, while the median price target was at 1,870 rupees, according to data compiled by LSEG.
($1 = 95.0750 Indian rupees)
Newsletter
Week in Review
Subscribe to our Chief Editor’s Week in Review
Our chief editor shares analysis and picks of the week's biggest news every Saturday.
Sign up for our newsletters
Get our pick of top stories and thought-provoking articles in your inbox
Get the CNA app
Stay updated with notifications for breaking news and our best stories
Get WhatsApp alerts
Join our channel for the top reads for the day on your preferred chat app