Q3FY21 Result Update - Coforge Ltd - ICICI Direct

Coforge Ltd (Coforge) registered healthy revenue growth, up 3.3% QoQ in constant currency terms, above our estimate of 2.7% QoQ growth. The revenue growth was led by travel (up 9.7% QoQ), others (up 3.5% QoQ) and BFS (up 12.7% QoQ). Geographically, growth was led by Americas (up 6.1% QoQ) and EMEA (up 3.8% QoQ). Digital revenues (including IP) increased 6.2% QoQ. Further, Coforge has guided for revenue growth of 6% YoY organic growth in FY21E (CC terms) and 18% EBITDA margin in FY21E before Esop cost.

Valuation & Outlook

Consistent large deal wins, digital prowess, client mining in BFS & Insurance, healthy order book and revival in travel segment are expected to drive long term revenues. This, coupled with improving margins, prompt us to have a positive view on the stock from a long term perspective. Hence, we upgrade the stock from HOLD to BUY with a revised target price of Rs. 2875 (26x PE on FY23E EPS) (earlier target price of Rs. 2690).

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_Coforge_Q3FY21.pdf

Shares of NIIT TECHNOLOGIES LTD. was last trading in BSE at Rs.2423.4 as compared to the previous close of Rs. 2446.75. The total number of shares traded during the day was 3876 in over 703 trades.

The stock hit an intraday high of Rs. 2434.35 and intraday low of 2369.95. The net turnover during the day was Rs. 9325439.

Source : Equity Bulls

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