Coforge reports 19.4% decline in Q1 net profit. Revenue rises 8.1%

Following the results, shares of Coforge jumped over 4% in trade on Monday before erasing gains to trade higher by 1%.

For the quarter ended June 30, 2024, the company’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) grew by 23.3% YoY to ₹408 crore. EBITDA margins for the quarter expanded to 17% from 14.9% in the same quarter last year. Meanwhile, the net profit margin for Q1FY25 contracted to 5.5% from 7.4% in the corresponding period last year.

During the first quarter, the company saw an order intake of $314 million and added 10 new clients. Coforge’s headcount grew by 1,886 sequentially to 26,612. The company also acquired a 28% stake in Cigniti.

Sudhir Singh, chief executive officer of Coforge stated that the company has seen an expansion in EBITDA margins, and with a strong order book, the company will continue with growth ahead.

“A very strong executable order book, backed by the highest ever headcount addition, sets us up for continued growth ahead.” He said.

Coforge also announced that its wholly-owned subsidiary Coforge DPA NA has entered into an asset purchase agreement with OptML to acquire customer contracts, key managerial personnel, employees, and vendors. The acquisition is expected to be completed by Q2FY25 for a consideration of $6.6 million for a 51% stake in the company. The remaining amount will be paid on achieving financial performance goals.

Coforge declared an interim dividend of ₹19 per equity share having a face value of ₹10 each.

Shares of the company have declined by nearly 1% since the beginning of the year. The stock has gained over 30% in the past year.