Results filed 23 October 2026 · Market cap ₹90,606 crore · PE 41.7
GrowthGuidance raisedTranscript read
Revenue
+54.8%
on a year ago
EBITDA
+67.0%
on a year ago
Profit to shareholders
+55.9%
on a year ago
EBITDA margin
19.8%
+0.7 pts on last quarter
Coforge reported strong Q2 FY2027 revenue growth of 10.1% QoQ (3.8% organic CC) and consolidated EBIT margin of 16.0%, leading to an upgrade in full-year EBIT margin guidance to 16.0%. Order intake reached a record quarterly high of $1.04B with eight large deals signed, bringing the 12-month executable order book to $2.38B. Encora integration was completed with G&A synergies realised, though Encora's quarterly revenue was sequentially flat and total DSO lengthened to 110 days due to contract novation delays.
Coforge Limited, Q2 FY27₹ crore, consolidated
Q2 FY27
Q1 FY27
vs previous quarter
Q2 FY26
vs a year ago
Revenue
6,171
5,528
+11.6%
3,986
+54.8%
Operating profit (EBIT)
938
817
+14.8%
561
+67.4%
Operating margin
15.2%
14.8%
+43 bps
14.1%
+114 bps
Other income
24.4
26.8
−9.0%
38.5
−36.6%
Exceptional items
−55.7
−55
–
0
–
Profit before exceptional items and tax
855
757
+12.9%
558
+53.1%
Profit to shareholders
586
519
+13.0%
376
+55.9%
Earnings per share (₹)
–
12.34
–
11.21
n.m.
Source: Coforge Limited’s filing to NSE, 23 October 2026. That filing gives only the year to date, so this quarter is it less the year to date in the previous quarter’s filing. Corrected: owners' profit works out at ₹901.8 crore, which with the minority share doesn't add up to the total; used ₹585.9 crore, the total less the minority share. Operating profit is revenue less every expense except interest, so it leaves out other income and exceptional items. n.m.: not meaningful, because the earlier figure was zero or negative, or the latest one is a loss, or, for earnings per share, because the number of shares changed.
What stood out
Record fresh order intake crossing $1B and 8 large deal wins in a single quarterSourceTranscript Page 3: '...our order intake for the quarter, for the second time in our history as a firm, is more than US$1 billion' and 'In Q2, we signed eight large deals, this is the highest number of large deals we have signed in any quarter in our history.'
Full-year consolidated EBIT margin guidance raised from 15.5% to 16.0%SourceTranscript Page 2: 'We are pleased to raise our consolidated EBIT margin guidance for fiscal year 2027 to 16%, from the 15.5% we had shared at the beginning of the year.'
Encora integration completed; revenue was sequentially flat in Q2 post acquisitionSourceTranscript Page 13: 'The average for the quarter, the last quarter, the full quarter number was close to 148, so it is largely flat in the current quarter...' (Saurabh Goel).
Guidance
Metric
Guidance
Period
Consolidated EBIT MarginSourceTranscript Page 2: 'We are pleased to raise our consolidated EBIT margin guidance for fiscal year 2027 to 16%, from the 15.5% we had shared at the beginning of the year.'
16.0% (raised from 15.5%)
FY2027
Q4 Exit EBIT MarginSourceTranscript Page 2: 'We also plan to achieve a reported Q4 EBIT of 17%...'
17.0%
Q4 FY2027
FY2028 EBIT MarginSourceTranscript Page 17: 'If we exit at 17%, the least we should deliver next year should be 17%.'
At least 17% (exit run rate sustained)
FY2028
EBITDA MarginSourceTranscript Page 10: 'EBITDA margin, H1 is at 20.5. We remain confident of the guidance of 20.5% to 21% range.'
20.5% to 21.0%
FY2027
Free Cash Flow to PATSourceTranscript Page 10: 'Free cash flow, as I mentioned, guidance of 100% FCF to PAT for FY2027.'
100%
FY2027
Effective Tax RateSourceTranscript Page 10: 'Tax on a steady state basis 23% to 24%.'
23% to 24% on a steady-state basis
FY2027
Exceptional integration expensesSourceTranscript Page 22: 'I said exceptional expenses will be zero, so they are $5.9 million in the current quarter, it will be zero next quarter.'
$7.1M to $7.5M in Q3 and $1.2M in Q4, zero thereafter
Q3 FY27 - Q4 FY27
Consolidated EBIT margin guidance for FY2027 was raised by 50 bps from 15.5% to 16.0%.
Tailwinds
Strong order intake of $1,040M and 12-month executable order book reaching $2.38B (+45.4% YoY)SourceInvestor Presentation Page 6 & Factsheet Page 12.
Robust organic growth in BFS (+8.3% QoQ CC) and Government outside India (+20.8% QoQ CC)SourceTranscript Page 6: 'On an organic CC basis, BFS grew 8.3% sequentially... Government outside India grew 20.8% sequentially...'
Operational leverage in G&A driven by internal AI automationSourceTranscript Page 9: 'Following the 40% reduction in Encora G&A in Q1, the full quarter benefit of the cost actions is now visible with combined G&A improving further to 6.3%... versus 6.6% in the previous quarter.'
Key client expansion, with a second client exceeding $100M annualized run rateSourceTranscript Page 4: '...there is now a second client of Coforge that has crossed the $100 million annualized relationship run rate.'
Headwinds
Healthcare and Hi-Tech organic declineSourceTranscript Page 6: 'Healthcare high-tech declined 6.4% sequentially' on an organic CC basis.
Gross margin contraction and heavy near-term on-site AI investmentsSourceFactsheet Page 8: Gross Margin contracted 19 bps QoQ to 34.1%; Transcript Page 14 indicates heavy upfront investments in Momentuum Blue on-site delivery.
Forex hedge losses and acquisition-related integration cost overrunsSourceTranscript Page 9: Hedge losses were $10.2M (INR 971 Mn) in Q2, and total acquisition/integration expenses reached $17M vs earlier guided $15-16M due to tax planning and legal entity rationalization.
Working capital stretch and delayed invoicing due to contract novationSourceTranscript Page 15 & Factsheet Page 13: DSO rose to 110 days from 102 days QoQ, driven by contract novation delays moving contracts from US to India.
New businesses and products
new business · Launched and operating
Momentuum Blue & Mod Squads
Expected benefit
Accelerates time to value on AI investments via Forward Deployed Engineers (FDEs) and hybrid human-agent pods; driving higher gross margins starting Q4.
Risks
High on-site investment costs currently depressing gross margins until scaling occurs.
Timeline
Launched in July 2026; expected to show material spike in gross margin by Q4 FY27.
Investment
Described as 'pumping in an exceptionally high order of investment to sustain it' (Transcript Page 14).
Helps enterprises select, adapt, govern, and deploy open-weight AI models at scale while keeping control of context, IP, and costs.
SourceTranscript Page 5: 'To address this, and you would have seen this, we recently announced AI Launchpad, the open-weight AI ecosystem for the enterprise.'
new product · Introduced
CXNova
Expected benefit
Agentic CX orchestration platform designed to help enterprises deliver personalization, engagement, and continuous optimization.
Acts as a strategic AI engineering and nearshore delivery hub serving European and global clients.
SourcePress Release Page 3: 'Expanded Kraków Engineering Center in Poland as a strategic AI engineering and nearshore delivery hub...'
partnership · Expanded
Expanded Partnership with Pega
Expected benefit
Build and deliver Pega-powered offerings under Coforge's own brand to market jointly.
Timeline
Current
SourceTranscript Page 8: 'We expanded our partnership with Pega, a pivotal shift in how Coforge goes to market.'
Things to check
20% more shares than a year ago: growth funded partly by new capital
Working capital stretch: Total DSO increased by 8 days QoQ to 110 days due to unbilled spikes and novation delaysSourceFactsheet Page 13: Total DSO moved from 102 to 110 days (DSO Unbilled up to 26 from 24; DSO Contract Asset up to 19 from 15); Transcript Page 15 explains delays in invoicing/collections.
Acquisition integration cost overrunsSourceTranscript Page 9: '...we had guided for exceptional expenses of $15 to $16 million... whereas we have ended up spending around $17 million. This increase was on account of overruns related to tax planning...'
Significant increase in leverage and net interest expense following Encora acquisitionSourceFactsheet Page 9 & 10: Borrowings stood at INR 56,457 Mn ($589M) vs INR 6,082 Mn ($69M) in Q2 FY26; Net interest expense jumped to INR 836 Mn vs INR 292 Mn YoY.
How the call went
Management demonstrated strong operational clarity and provided transparent breakdowns of integration costs and hedge positions, although specific forward quarterly organic growth figures were deflected with qualitative commentary.
Specific or vague
Management provided detailed metrics on order intake splits, organic vs inorganic growth rates, FX hedge losses ($10.2M), integration costs ($17M vs $15-16M guide), and future hedge expectations.
Candour
Management was candid in acknowledging that Encora revenue was flat QoQ and that acquisition-related legal/tax integration costs exceeded initial budgets due to entity restructuring.
The hard questions
Analysts probed into flat QoQ revenues at Encora, DSO increase/OCF reduction, lack of gross margin expansion (most margin gains coming solely from SG&A cuts), and pricing concessions on AI deals.
What analysts pressed on
Encora's organic performance and flat QoQ revenues post-acquisition.
Working capital deterioration with DSO rising to 110 days and OCF/EBITDA dropping.
Whether margin expansion is sustainable without gross margin expansion, given it has been G&A-led.
Whether AI productivity gains are being competed away or passed to clients.
Answers that sidestepped
Management bypassed providing explicit organic revenue growth guidance percentages for Q3/Q4, resorting to qualitative statements like 'exceptionally robust' and 'industry growth leader'.
Numbers against the story
Management emphasized that margin expansion is driven by delivery transformation and AI capabilities, yet the P&L clearly indicates gross margin was slightly down (-19 bps QoQ to 34.1%), with the entire EBIT margin improvement coming from lower SG&A (down 44 bps QoQ to 13.5% of revenue). Furthermore, while management expressed great enthusiasm over Encora's deal pipeline, the numbers show Encora's revenue was flat sequentially in Q2.
Figures: the company’s results filing with NSE, linked under the table.
Notes written by gemini-3.8-flash from the documents above on 1 November 2026. They summarise what the company said and can contain mistakes: check the source passage before relying on a point. Not investment advice.