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Revenue
₹3,026 Cr
verified against source
Revenue YoY
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reported change
EBITDA
Pending
latest reported figure
Source
screener in
record provenance
Actual signal trajectory
Where this quarter sits.
Quarter read
What the record says.
Coforge delivered an exceptionally strong Q2 FY25, with consolidated revenue of $369.4M, up 26.8% sequentially in USD terms, driven by broad-based growth across all verticals and geographies. The organic business grew 6.3% QoQ, while Cigniti added 6.1% QoQ, validating management's earlier assertions on demand recovery and synergy realization. EBITDA margin expanded 55bps YoY to 15.8%, with Cigniti's standalone margin jumping 360bps QoQ to 16.2%. Order intake surged to $516M, and the 12-month signed order book rose 40% YoY to $1.3B. Management raised Cigniti's FY25 EBITDA margin target to 18%+ (from 16.5%). Key risks include ESOP cost headwinds of ~120bps incremental in H2 and potential furlough impact in Q3.
Colored figures show movement against the previous available record.
Guidance to track
- Management now expects Cigniti's EBITDA margin to exceed 18% by the end of the fiscal year, up from the earlier target of 16.5%.
- Management reiterated its medium-term guidance of reaching $2B in revenue while delivering material EBITDA margin expansion.
- CFO guided that incremental ESOP cost will be ~120bps per quarter for the next two quarters, with total ESOP cost of ~180-200bps.
Risks flagged
- Incremental ESOP cost of ~120bps per quarter in H2 FY25 will pressure reported EBITDA margins.
- Management expects normal furloughs in Q3, which could temper the strong sequential growth trajectory.
- Some GCC deals have a build-operate-transfer structure, leading to potential revenue cliff after the initial mandate period.
- While management expects no further past liabilities, integration expenses may persist for a couple of quarters.
Key quotes
- The growth story of Coforge is now 29-quarters old. This is a time-tested team that is hungrier today, more hungry today, than it was more than seven years back when we first came together.
- We expected Cigniti to hit a 16.5% EBITDA target by Quarter Four, but we now believe that we will hit more than an 18% EBITDA target for the standalone Cigniti business by Quarter Four this year.
- The only thing that's exceeded even margins on the expectation side has been the eagerness with which a team that was largely selling only one service line has embraced the other ten that they can now sell.
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