Shares of Coforge rallied nearly 11% in early trade on Wednesday after the IT services firm reported strong earnings for the fourth quarter ended March 31, 2026, supported by robust order intake, improved operational efficiencies and solid execution.

Extending gains for a second straight session, Coforge shares opened 8.17% higher at ₹1,263.80 on the BSE, after closing 1.41% higher in the previous session. In the first hour of trade so far, the stock rose as much as 10.77% to ₹1,294.15, taking its market capitalisation to ₹42,545 crore.

On a year-to-date (YTD) basis, Coforge shares are down 23% amid widespread selling in the IT sector, though they have recovered over 4% in the past month. Over the last one year, the stock has delivered a negative return of 12%, while declining 28% over six months.

The stock had touched its 52-week high of ₹1,994 on June 8, 2025, and a 52-week low of ₹1,008.50 on March 17, 2026.

Strong Q4 boosts sentiment

Coforge reported a sharp improvement in its March quarter (Q4 FY26) performance, lifting investor sentiment. The company posted a consolidated net profit of ₹612 crore, up from ₹250 crore in the previous quarter. However, the board has deferred the dividend decision to a later meeting.

Revenue from operations rose 5.2% sequentially to ₹4,450 crore, compared with ₹4,232 crore in the December quarter. On a year-on-year basis, revenue grew 30% in rupee terms, 28.7% in constant currency and 21.2% in dollar terms, reflecting broad-based growth across key verticals.

The strong jump in Q4 profitability was largely driven by operating leverage and margin expansion. However, reported profit was also aided by a one-time reversal of deferred tax liability linked to the Cigniti merger. The company said its normalised profit after tax (PAT) for the quarter stood at $47 million, compared with the reported $67.3 million.

For the full financial year FY26, Coforge reported revenue of ₹16,420.7 crore (or $1.87 billion), marking a 35.9% year-on-year increase in rupee terms and 29.2% growth in dollar terms. EBITDA rose 76.9% YoY to ₹3,046.4 crore, while EBIT climbed 82.7% to ₹2,364.5 crore. Net profit for the year came in at ₹1,555.7 crore (or $177.4 million), up 91.6% in rupee terms and 82.1% in dollar terms.

The company’s deal momentum remained strong, with order intake at $648 million during the quarter, including five large deals. Its executable order book for the next 12 months stood at $1.75 billion, registering a 16.4% year-on-year increase.

Elara Securities upgrades stock to ‘Accumulate’

According to Elara Securities, Coforge’s Q4 performance was led by strong growth in healthcare, travel and emerging verticals, while BFSI remained relatively subdued due to a client-specific issue. It has also upgraded Coforge to ‘Accumulate’ from ‘Reduce’, while increasing its target price to ₹1,380 from ₹1,260, raising its earnings estimates by 9-10% for FY27 and FY28.

The brokerage highlighted that the company’s executable order book remains robust, and even under conservative book-to-bill assumptions, mid-teen growth appears achievable in FY27. It has factored in an annual revenue loss of $40–50 million due to the exit from a low-margin India business, but expects this move to support margin expansion over time.

Elara projects around 14% revenue growth in dollar terms over FY26-FY28, driven by operating leverage and a sharper focus on higher-margin segments. As a result, profitability is likely to improve, with earnings expected to grow at a CAGR of about 17% during the same period.

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