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View Promises →Coforge Ltd — Q1 FY26
Coforge delivered an exceptional Q1 FY26 with 9.6% sequential dollar revenue growth, driven by a 32.3% surge in the Travel vertical and strong deal execution.
bullish
high
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Coforge delivered an exceptional Q1 FY26 with 9.6% sequential dollar revenue growth, driven by a 32.3% surge in the Travel vertical and strong deal execution. The company signed five large deals and reported a record executable order book of $1.55 billion, up 46.9% YoY. Management reiterated a path to 14% EBIT margin for FY26, supported by operational leverage and easing of integration costs. The BFS vertical grew 32% YoY despite a marginal sequential dip, and the pipeline remains robust. Risks include macro uncertainty impacting enterprise budgets and potential delays in the Signiti merger closure.
कोफोर्ज ने पहली तिमाही में शानदार प्रदर्शन किया। कंपनी की कमाई में पिछली तिमाही के मुकाबले 9.6% का उछाल आया, जिसकी मुख्य वजह यात्रा क्षेत्र में 32.3% की बढ़ोतरी और बड़े सौदों को पूरा करना रहा। कंपनी ने पाँच बड़े सौदे किए और ऑर्डर बुक 1.55 अरब डॉलर तक पहुँच गई, जो पिछले साल से 46.9% ज्यादा है। प्रबंधन ने इस साल 14% मुनाफा मार्जिन हासिल करने का भरोसा दिया है। बैंकिंग क्षेत्र में भी पिछले साल के मुकाबले 32% बढ़ोतरी हुई। हालांकि, बाजार में अनिश्चितता और साइनिटी डील में देरी का जोखिम बना हुआ है।
Promises0 met · 2 missedRisks4 trackedTranscriptfull text
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Risks
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Risk Intelligence
Macro uncertainty impacting enterprise budgets
View Risks →
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Read Transcript →Quarter Snapshot
Sequential Dollar Revenue Growth
9.6%
+9.6% QoQ
Sequential growth in US dollar terms for Q1 FY26.
Executable Order Book
$1.55B
+46.9% YoY
Total value of locked orders over next twelve months, a record high.
Large Deals Signed
5
N/A
Five large deals signed in Q1, with increasing velocity and median size.
Attrition Rate (LTM)
11.3%
-0.2pp QoQ
Last twelve month attrition fell further, among lowest in the industry.
What Changed vs Last Quarter
NEW
14% EBIT margin target for FY26
Management reiterated a pathway to 14% reported EBIT margin for the full fiscal year, supported by operational leverage and cost optimization.
NEW
At least 20 large deals in FY26
The company aims to close at least 20 large deals in the current fiscal year, up from 14 in the prior year.
NEW
H2 growth stronger than H1
Management expects second half revenue growth to be much stronger than first half due to large deal ramp-ups.
NEW
Signiti merger closure by Dec 2025/Jan 2026
The merger with Signiti is expected to close by December 2025 or January 2026, with effective date of April 1, 2025.
DROPPED
Very strong growth in FY26
Management expects robust revenue growth in FY26, with organic growth not slowing vs FY25.
DROPPED
Reported EBIT to expand materially in FY26
EBIT margin expected to improve significantly from Q4 exit of 13.2%, with large part of journey to 14% covered in FY26.
DROPPED
FY27 target: $2B revenue, 18% reported EBITDA
Reiterated medium-term targets; management aims to achieve $2B revenue sooner than FY27.
DROPPED
ESOP cost to decline to ~100bps from H2 FY26
ESOP cost expected to reduce by 70-80bps from current 1.8% by Q3 FY26.
NEW RISK
Macro uncertainty impacting enterprise budgets
Tariff uncertainties and macro volatility continue to cause oscillation in run-the-enterprise budgets, potentially affecting discretionary spending.
NEW RISK
Margin pressure from deal ramp-up and costs
Ramp-up of the largest deal and increased visa costs, subcontractor expenses, and depreciation weighed on margins in Q1; wage hike in Q3 could pose further headwinds.
NEW RISK
Free cash flow pressure from data center CapEx
Higher CapEx for the AI data center deal impacted free cash flow; while management expects normalization, sustained asset-heavy deals could strain cash generation.
RISK GONE
Travel vertical demand slowdown
Geopolitical uncertainty and cautious airline spending may impact travel vertical growth, though management remains confident.
RISK GONE
Client complaint liability
A client complaint alleges security breach; liability amount undetermined but client is not material (not in top 50).
RISK GONE
Sabre financial health risk
Sabre's high debt ($4.7B) and recent profit warnings raise concerns; Coforge has taken credit insurance and non-recourse factoring.
🤫 Topics management stopped discussing
Mentioned in Q1 FY25, Q3 FY25
Cigniti merger involves ongoing integration costs; CFO noted expenses were $1.9M in Q3 and expected to decline but could persist.
Mentioned in Q3 FY25, Q4 FY25
ESOP cost expected to reduce by 70-80bps from current 1.8% by Q3 FY26.
Fast read
Guidance and risk preview
Management reiterated a pathway to 14% reported EBIT margin for the full fiscal year, supported by operational leverage and cost optimization.
Tariff uncertainties and macro volatility continue to cause oscillation in run-the-enterprise budgets, potentially affecting discretionary spending.
View Risks →