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Travel vertical demand slowdown
View Risks →Coforge Ltd — Q4 FY25
Coforge delivered a landmark FY25 with 31.5% USD revenue growth to $1.445B, driven by 14 large deals and a record Q4 order intake of $2.1B.
bullish
high
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Coforge delivered a landmark FY25 with 31.5% USD revenue growth to $1.445B, driven by 14 large deals and a record Q4 order intake of $2.1B. The executable order book surged 47.7% YoY to $1.5B, underpinning strong FY26 visibility. Adjusted EBITDA margin held at 18%, with reported EBIT expanding 123bps QoQ to 13.2%. Management expects very strong growth in FY26, with material EBIT expansion, and reiterated the FY27 target of $2B revenue and 18% reported EBITDA. Key growth drivers include large deal momentum, AI/GenAI solutions (200+ deployed), and balanced performance across verticals and geos. Risk: potential demand slowdown in travel vertical due to geopolitical uncertainty and cautious airline spending.
कोफोर्ज ने वित्त वर्ष 2025 में शानदार प्रदर्शन किया। कंपनी की कमाई (रेवेन्यू) 31.5% बढ़कर 1.445 अरब डॉलर हो गई। यह 14 बड़े सौदों और रिकॉर्ड 2.1 अरब डॉलर के ऑर्डर के कारण हुआ। कंपनी के पास अब 1.5 अरब डॉलर के पक्के ऑर्डर हैं, जो पिछले साल से 47.7% ज्यादा हैं। इससे अगले साल की कमाई सुनिश्चित दिखती है। कंपनी का मुनाफा (EBITDA मार्जिन) 18% रहा। प्रबंधन को अगले साल बहुत अच्छी ग्रोथ और मुनाफे में बढ़ोतरी की उम्मीद है। उनका लक्ष्य 2027 तक 2 अरब डॉलर कमाई और 18% मुनाफा है। कंपनी AI समाधानों पर काम कर रही है और 200 से ज्यादा ऐसे प्रोजेक्ट लगा चुकी है। जोखिम: यात्रा क्षेत्र में मांग कम हो सकती है क्योंकि एयरलाइंस सावधानी से खर्च कर रही हैं।
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Read Transcript →Quarter Snapshot
Order Intake (Q4)
$2.1B
+75.1% YoY
Record quarterly order intake, equal to entire FY24 order book.
Executable Order Book
$1.5B
+47.7% YoY
12-month locked orders, up from $1B a year ago.
Large Deals Signed (Q4)
5
+150% QoQ
Includes Sabre ($1.56B), GPU-as-a-service, AI-led QE, Salesforce, and Cigniti deal.
Attrition (LTM)
10.9%
-210bps YoY
Continued decline; among lowest in the industry.
What Changed vs Last Quarter
NEW
Very strong growth in FY26
Management expects robust revenue growth in FY26, with organic growth not slowing vs FY25.
NEW
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.
NEW
FY27 target: $2B revenue, 18% reported EBITDA
Reiterated medium-term targets; management aims to achieve $2B revenue sooner than FY27.
UPDATED
ESOP cost to decline to ~100bps from H2 FY26
ESOP cost expected to reduce by 70-80bps from current 1.8% by Q3 FY26.
DROPPED
EBIT margin expansion to ~13.5% by Q3 FY26
CFO Saurabh Goel guided that EBIT margin should expand from 11.8% currently to roughly 13.5% by Q3 next year, driven by ESOP cost tailwinds and operational improvements.
DROPPED
Sustained robust growth expected in coming year
CEO Sudhir Singh expressed confidence in continued robust and sustained growth, citing strong order book, pipeline, and broad-based demand.
NEW RISK
Travel vertical demand slowdown
Geopolitical uncertainty and cautious airline spending may impact travel vertical growth, though management remains confident.
NEW RISK
Client complaint liability
A client complaint alleges security breach; liability amount undetermined but client is not material (not in top 50).
NEW RISK
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.
NEW RISK
Cigniti merger timeline uncertainty
Share swap proposal pending SEBI approval; expected consummation by Dec-Jan, but regulatory delays possible.
RISK GONE
Potential macroeconomic headwinds affecting client budgets
Analyst raised concerns about demand environment during budget season; management acknowledged gradual improvement but risks remain if macro conditions worsen.
RISK GONE
Integration and merger-related expenses
Cigniti merger involves ongoing integration costs; CFO noted expenses were $1.9M in Q3 and expected to decline but could persist.
RISK GONE
Cross-sell synergies from Cigniti may take time
Management indicated cross-sell pipeline takes ~3 quarters to materialize; only limited cross-sell in current large deal.
🤫 Topics management stopped discussing
Mentioned in Q1 FY24, Q1 FY25, Q2 FY24, Q3 FY24
Management reaffirms guidance of 50 bps improvement in adjusted EBITDA margin for the full fiscal year, with H1 margins expected to be 50 bps higher than H1 FY24.
Mentioned in Q1 FY24, Q2 FY24, Q3 FY24
Management expects to deliver within the annual guidance range of 13%-16% organic constant currency revenue growth, likely near the lower end.
Mentioned in Q1 FY25, Q2 FY25, Q4 FY24
While management expects no further past liabilities, integration expenses may persist for a couple of quarters.
Mentioned in Q1 FY25, Q4 FY24
Analyst raised concern that GenAI could deflate volumes in testing; management downplayed risk but acknowledged functional testing may be impacted.
Mentioned in Q1 FY24, Q4 FY24
New large deals, especially in new accounts, come with lower initial margins, which could pressure overall profitability.
Fast read
Guidance and risk preview
Management expects robust revenue growth in FY26, with organic growth not slowing vs FY25.
Geopolitical uncertainty and cautious airline spending may impact travel vertical growth, though management remains confident.
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