Coforge shares surge 6% after September quarter results; here is what global investment firms say on Q2

Coforge share price: Shares of the Noida-based information technology company, Coforge, rose as much as 6.05% to hit an intraday high of ₹1,866.60 on the National Stock Exchange (NSE) on Monday, October 27, after it reported its September quarter earnings post market hours on Friday.

Coforge on Friday reported an 18.4% quarter-on-quarter (QoQ) increase in its consolidated net profit to ₹375.8 crore in the second quarter of the current financial year. In the quarter-ago period, the company had clocked a profit of ₹349 crore.

During the quarter under review, its revenue from operations witnessed an 8.05% QoQ growth at ₹3,985.7 crore, compared to ₹3,688.9 crore in the first quarter of the same fiscal year.

In the second quarter of FY26, the company signed five large deals across North America and APAC. Furthermore, its order executable stood at $1.63 billion, marking a 26.7% year-on-year (YoY) growth.

Coforge's board of directors also declared its second interim dividend of ₹4 per equity share with a face value of ₹2 each (fully paid-up).

It also fixed October 31, 2025, as the record date for its payout.

“The 8.1% sequential INR growth in Q2, a next twelve-month signed order book which is 26.7% higher YoY, a sales execution engine that signed 14 large deals last year and has already closed 10 large deals in the first half of this year," said Sudhir Singh, Chief Executive Officer and Executive Director, Coforge.

Here is what global investment firms say on Coforge's Q2 earnings:

Global investment bank Morgan Stanley said that its performance in Q2 has allayed investor concerns. It said that visibility for the second half of the current financial year looks strong on both the growth and margins fronts. Beyond FY26, Coforge’s strategy to maintain a minimum EBIT margin threshold of 14% while sustaining revenue growth was deemed “the right approach”.

Morgan Stanley added that consistent execution across parameters creates potential for stock re-rating.

JPMorgan said that Coforge delivered on two key watchpoints – margins and cash flows – after previous challenges. Q2 EBIT margin at 14% beat JPMorgan estimates by 50 bps, while revenue grew 5.9% QoQ in constant currency, broadly in line with expectations.

The investment bank noted that deal wins remained above $500 million for the fifth straight quarter, reflecting continued demand momentum. Management commentary on robust H2 growth further reinforced confidence.

Jefferies said Coforge’s Q2 results were solid, marked by 6% QoQ constant-currency growth and 80 bps margin expansion to 14%, alongside healthy free cash flow conversion. It believes the company’s 14% EBIT margin floor and FCF conversion guidance of 75–80% should ease investor worries about profitability and growth quality. Jefferies raised its FY26–28 earnings estimate by 2–5%, projecting a 20% EPS CAGR over FY26–28.

Nomura called Coforge’s performance in line on revenue and ahead on profitability, citing a strong, executable order book that supports near- to medium-term growth visibility.

EBIT margin normalisation and a return to positive FCF are expected to rebuild confidence. Nomura raised FY26–28 EPS estimates by 1–2%.

Citi acknowledged that margins were slightly ahead of estimates but said revenues in dollar terms were below expectations. On the positive side, executable order book rose 26.7% YoY, headcount increased 7.5% YoY, and FCF improved to $37.5 million in Q2 from negative in Q1.

Citi warned that forward-looking commentary and order book trends may already be priced into valuations.