Coforge - Contender On A Path Of Championship: IDBI Capital Initiates Coverage

IDBI Capital Report

Coforge Ltd.’s presence in niche sub verticals of banking, financial services insurance and travel, transportation and hospitality, consistent deal wins, lower attrition and lower client concentration distinguishes it from peers.

With the advent of new Chief Executive Officer, its performance has improved significantly registering revenue compound annual growth rate of 17% and 130 basis points improvement in Ebit margin during FY18-FY22.

In addition, based on nine month executable order book over next 12 months i.e. $ 841 million indicates a visibility of 20% revenue growth in next 12 months (based on historical trend).

Coforge’s ability to convert challenges to opportunities (as seen in TTH) will help in defending itself from the macro challenges. Considering this, we estimate revenue and profits to increase at 16% and 21% CAGR over FY23E-25E.

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