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Revenue
₹4,232 Cr
verified against source
Revenue YoY
23%
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 a strong Q3 FY26 with 4.4% sequential CC revenue growth, driven by six large deal wins and a record executable order book of $1.72B, up 30% YoY. Year-to-date dollar revenue growth stands at 32.8%, with top 10 accounts growing 47% YTD. EBIT margin of 13.4% expanded 191bps YoY, though down 60bps QoQ due to wage hikes and hedge losses; underlying EBIT excluding hedge losses was 14.4%. Management guided to 14% EBIT for FY26 and expects FY27 to be exceptional, fueled by strong pipeline in banking, travel, healthcare, and public sector. The Encora acquisition ($2.35B) is on track for regulatory approvals by March-April, with no equity dilution planned. Risk: integration of Encora and potential margin pressure from large deal ramp-ups.
Colored figures show movement against the previous available record.
Guidance to track
- Management reiterated guidance of 14% EBIT margin for full fiscal year 2026, with Q4 expected to deliver 15% EBIT.
- Management expects FY27 to be an exceptional year, with continued robust growth driven by large deal pipeline and key account momentum.
- Management confirmed that the guidance of no EPS dilution in FY27 for the combined business remains intact, even after finalizing a term loan instead of QIP.
Risks flagged
- Integration of Encora may face challenges in achieving synergies and margin targets, with integration expenses expected in Q4 and Q1.
- Hedge losses of INR 434 million in Q3 adversely impacted reported EBIT by 26bps; management is revisiting hedging strategy but no final decision yet.
- Unbilled revenues increased due to nature of contracts; while management has guardrails, continued rise could pressure cash flows.
Key quotes
- The age of AI experimentation is over. What we're witnessing is a market inflection point.
- We are also willing to underwrite outcomes. Our risk-reward commercial models tie our fees to our clients' achieved results.
- We have concluded that we will not need a QIP for retiring the term loan in the target company.
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