Coforge Delivers Strong Q1FY25 with Revenue Growth and Continued Momentum

Coforge Limited, a leading global IT solutions organisation, announced robust financial results for the quarter ended June 30, 2024 (Q1FY25), showcasing continued growth and industry recognition.

Financial Highlights Paint a Positive Picture

Revenue reached ₹24,008 crore (USD 291.4 million), reflecting a 1.6% increase quarter-on-quarter and a healthy 7.8% year-on-year growth on a constant currency basis. A significant improvement in profitability further underscores this growth. The company’s EBITDA margin climbed to 17%, marking a 210 bps improvement YoY, demonstrating strong operational efficiency.

Additionally, normalised Profit After Tax (PAT) witnessed a noteworthy 28.2% increase YoY, reaching ₹2,285 crore. Cash flow from operations also remained positive at USD 23.2 million, indicating healthy financial health. To reward shareholders for this strong performance, the Board recommended an interim dividend of ₹19 per share, payable on August 2, 2024.

Business Momentum Maintains Strong Trajectory

Beyond financial performance, Coforge maintained its robust business momentum. Order intake continued its impressive streak, reaching USD 314 million, marking the tenth consecutive quarter exceeding USD 300 million. This consistent order booking signifies strong client confidence and a healthy pipeline for future growth. The company also actively expanded its client base by adding 10 new clients during the quarter.

On the talent front, Coforge witnessed significant growth, with headcount reaching 26,612 by adding 1,886 employees sequentially. This expansion reflects the company’s commitment to building a strong talent pool to address evolving client needs. Additionally, Coforge achieved a lower LTM IT attrition rate of 11.4%, a 192 bps improvement YoY. This reduction in employee turnover highlights a positive work environment and employee satisfaction.

Strategic Investments and Industry Recognition Drive Future Success

Coforge further solidified its strategic position by acquiring a 28% stake in Cigniti Limited, a leading provider of software quality engineering services. This investment expands Coforge’s service portfolio and enhances its digital transformation capabilities. The company also revamped its board to leverage diverse expertise and drive future growth.

Coforge’s commitment to excellence was further validated by a series of prestigious industry recognitions. The company secured the coveted “ServiceNow 2024 Emerging Industry Partner of the Year – Worldwide Award,” acknowledging its leadership in the ServiceNow ecosystem. Additionally, Coforge received the “Intelligent Automation Award” and “Market Maker Partner of the Year” awards from Pega at PegaWorld iNspire 2024, signifying its expertise in automation solutions.

Furthermore, Coforge and its client, IAT Insurance Group, jointly received the 2024 Standard of Excellence Customer Award from Duck Creek Technologies, highlighting their successful collaboration in the insurance sector. Finally, Coforge successfully retained the prestigious “Top Partner of the Year” Award from Salesforce for the tenth consecutive year, a testament to its long-standing partnership and commitment to the Salesforce platform.

“FY25 has started on a strong note with a healthy increase in EBITDA margins by 210bps over last year and OCF of $23.2 million. A very strong executable order book, backed by the highest ever headcount addition, sets us up for continued growth ahead,” said Mr. Sudhir Singh, Chief Executive Officer, Coforge Ltd.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.