Coforge (COFORGE) Q1 24/25 earnings summary

Executive summary

• Q1 FY25 began with strong momentum, with revenue growing 8.1% YoY in INR and 7.2% YoY in USD, reaching INR 24,008 Mn ($291.4 Mn), and robust order intake of $314M.

• Adjusted EBITDA margin improved to 17.9%, up 20.9% YoY, and normalized PAT rose 28.2% YoY to INR 2,285 Mn.

• Achieved 3.7% sequential CC growth excluding India, with record headcount addition and IT attrition at 11.4%.

• Secured operational control of Cigniti Technologies, with plans to consolidate finances from Q2.

• Board approved unaudited financial results and declared an interim dividend of Rs. 19 per share for FY 2024-25.

Financial highlights

• Sequential revenue growth of 1.6% in CC and USD terms; 1.8% in INR terms, with consolidated revenue at Rs. 24,008 million.

• Adjusted EBITDA at INR 4,286 Mn ($49.6M), up 20.9% YoY; margin at 17.9%.

• Normalized PAT at INR 2,285 Mn, up 28.2% YoY; reported PAT at INR 1,332 Mn, down 19.4% YoY due to one-time expenses.

• Operating cash flow of $23.2M, a turnaround from negative $20.5M in Q1 FY24.

• Order intake of $314M, marking the 10th consecutive quarter above $300M, and executable order book up 19.3% YoY to $1,070M.

Outlook and guidance

• Strong executable order book of $1,070M for the next 12 months, up 19.3% YoY, and high repeat business rate at 96.5%.

• Confident of robust and profitable growth in upcoming quarters, expecting margin expansion of at least 50 bps in H1 FY25 over H1 FY24.

• No formal annual revenue growth guidance will be provided, aligning with industry peers.