Buy Coforge: target of Rs 2290: ICICI Securities

What happened

ICICI Securities maintained a BUY rating on Coforge with a revised target price of Rs 2,290. The report cited management guidance for record deal value, a higher profit margin outlook, and improved cash conversion.

Confirmed

Global impact / market context

A higher target price signals the broker expects more earnings ahead. Raised profit margin estimates mean Coforge could keep more profit from each sale, while stronger cash conversion means more cash available to fund operations and growth without extra borrowed money.

Analyst inference

The report ties Coforge's outlook to large new deal wins converting quickly into revenue and to AI-led efficiencies lifting profit per sale. Investors reading this research may weigh faster revenue growth and better cash generation against execution risk.

Analyst inference

What to watch

1. Coforge management guided to record deal value of USD 1bn in Q2FY27, up 50.6% quarter on quarter and 102% year on year, and hopes to extend this run-rate into Q3. Confirmed
2. Watch whether the 16% EBIT margin guidance, which means operating profit as a share of revenue, is met and whether the expected 17% exit margin in Q4FY27 and beyond is achieved. Proposed
3. Track whether free cash flow reaches 100% of profit after tax in FY27, since that would show earnings convert into cash available for the business. Analyst inference

Evidence

• Original source link unavailable