Coforge (COFORGE) Q1 24/25 earnings summary

Executive summary

• Q1 FY25 began with strong revenue growth of 8.1% YoY in INR and 7.2% YoY in USD, reaching INR 24,008 Mn ($291.4 Mn), and robust foundations for future growth.

• Adjusted EBITDA margin improved to 17.9%, up 20.9% YoY, with record headcount addition and low attrition at 11.4%.

• Order intake remained robust at $314M, marking the tenth consecutive quarter above $300M, and executable order book rose 19.3% YoY to $1,070M.

• Cigniti Technologies acquisition progressing, with operational control assumed and full consolidation expected from Q2.

• Board approved unaudited financial results, declared an interim dividend of Rs. 19 per share, and approved reclassification of Hulst B.V. from promoter to public category.

Financial highlights

• Sequential revenue growth of 1.8% in INR and 1.6% in USD; consolidated revenue at Rs. 24,008 million for Q1 FY25.

• Adjusted EBITDA at INR 4,286 Mn, up 20.9% YoY, with margin at 17.9%.

• Normalized PAT at INR 2,285 Mn, up 28.2% YoY; reported PAT at INR 1,332 Mn, impacted by one-time expenses.

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

• Net headcount addition of 1,886, total headcount at 26,612.

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 coming quarters, supported by strong order book and headcount addition.

• Margin guidance: targeting 50 bps higher adjusted EBITDA margin for H1 FY25 vs H1 FY24.

• No full-year revenue growth guidance provided, aligning with industry peers.

• Management highlights continued focus on large deal wins.