Coforge: Can a Robust $1.7 Billion Order Book Fuel a 60% Upside in the Stock?

Synopsis: An IT mid-cap delivers its strongest quarterly margins in years, beats profit estimates, and sees a leading brokerage revise earnings forecasts upward – with a target implying 60% upside from current levels. 

Coforge Limited has reported strong numbers for the March 2026 quarter, beating analyst estimates on revenue, margins, and profit. Brokerage firm Nuvama has retained its Buy rating on the stock with a target price of Rs 2,200, implying around 60% upside from current levels.

Q4 FY26: Revenue and Margin Beat Expectations

Coforge reported revenue of Rs 4,450 crore in Q4 FY26, up 5.2% from Rs 4,232 crore in the previous quarter and up 30% from Rs 3,422 crore in the same quarter last year. Operating profit jumped 21% QoQ and66% YoY to Rs 876 crore, with operating profit margin expanding sharply to 20% from 17% in Q3 FY26 and 15% in Q4 FY25.

Nuvama noted that EBIT margin expanded 230 basis points QoQ to 16.6%, significantly beating its estimates. Adjusted net profit of Rs 470 crore came in above Nuvama’s estimate of Rs 430 crore.

Reported net profit for the quarter stood at Rs 666 crore, more than doubling from Rs 297 crore in Q3 FY26 – a jump of 124% QoQ – and up 117% from Rs 307 crore in Q4 FY25.

Full Year FY26: A Strong Finish

For the full year FY26, Coforge reported revenue of Rs 16,403 crore, up 36% from Rs 12,051 crore in FY25. Annual operating profit rose 73% to Rs 2,936 crore from Rs 1,694 crore in FY25, with OPM improving to 18% from 14%. Net profit for FY26 nearly doubled to Rs 1,745 crore from Rs 936 crore in FY25, a growth of 86% year-on-year.

Deal Pipeline and Order Book Remain Healthy

Nuvama highlighted a strong deal pipeline as a key growth driver. As of May 2026, Executable Order Book over next twelve months is at $1.75 billion i.e. approx Rs 16,658 crore, 16.4% YoY and 2% QoQ, providing good visibility into future revenue. Order intake during the quarter grew 9.3% QoQ. The brokerage noted that the banking and financial services segment remained soft in the near term, but management expects a recovery going forward.

Strategy Shift: Profitability Over Pure Growth

Nuvama pointed to a clear change in Coforge’s strategy. With growth now on a steady track, the company is focusing more on improving profitability and cash flows rather than chasing top-line expansion alone. In response to the better-than-expected quarterly performance, Nuvama has revised its earnings per share estimates upward by 7.5% for FY27 and 8% for FY28.

Nuvama’s Take

Nuvama has retained its Buy rating with a target price of Rs 2,200, pointing to around 60% potential upside from current levels. Strong earnings visibility, improving margins, and a healthy order backlog are the key reasons behind the brokerage’s positive outlook on the stock.

About the company

Coforge is a mid-tier Indian IT services and digital transformation company headquartered in Noida. Formerly known as NIIT Technologies, the company provides services across cloud computing, AI, digital engineering, data analytics, enterprise applications, and automation solutions. Coforge primarily serves industries such as banking & financial services, insurance, travel, healthcare, and manufacturing. The company has operations across 23 countries with over 32,000 employees and is known for its strong deal pipeline, high repeat business, and growing focus on AI-led digital transformation services.

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