Coforge Q2 FY22 Revenue up 7.5% Q-on-Q in constant currency (CC) terms

The company reported strong growth in revenue, significant expansion in EBITDA margin, and continued increase in its billable headcount. Deal flow was robust with three large deals secured.

Q2 F Y 2 2  –  Financial highlights

•    Revenues for the quarter were $ 212.8 million and Rs 15,694 Million:

o  Up 37.4% in dollar terms and 36.0% in rupee terms year-on-year.

o  Up 6.5% in dollar terms and up 7.4% in rupee terms, sequentially.

•   Adjusted EBITDA margin (before ESOPs and acquisition-related costs) for the quarter under review expanded by 260 bps Q-on-Q in constant currency terms to 18.7%, driven by higher offshore revenues and improved utilization.

•   PAT for the quarter increased 22.8% in dollar terms to $ 19.9 mn and 21.6% in rupee terms to Rs 1,467 mn, year-on-year.

Q2 F Y’2 2  –  Business highlights

•   Total order book executable over the next twelve months has expanded 40.6 percent year-on-year to $688 million as on September 30, 2021.

•   Order intake during the quarter was $285 million, on the back of three large deals secured during the quarter out of which two were greater than $ 50 Mn TCV each.

•    Total headcount at Coforge, after including the employees of the recently acquired SLK Global, increased to 20,786 during the quarter under review.

“Our investments in Product Engineering, Cloud, Data, Automation and Integration capabilities continue to power our path to being a $ 1 Bln+ firm next year. This is a landmark year for the firm as we anticipate that we shall grow revenues by at least 35% and our adjusted EBITDA by at least 40% over the previous year. Our ability to significantly improve margins in the context of a supply-constrained and escalating cost while simultaneously driving exceptional growth is a testament to the execution capabilities of Team Coforge”, said Sudhir Singh, Chief Executive Officer, Coforge Ltd.
 
In view of sustained deal wins and incremental business from its customer base, the company is now planning for a growth (excluding SLK Global contribution) of at least 22% in constant currency terms during FY’22, which is higher than the at least 19% growth indicated earlier. This translates to at least 35% of consolidated (including SLK Global) growth in constant currency terms for the firm in FY22. The firm continues to target an adjusted EBITDA margin of 19% for the year.

The Board has recommended an interim dividend of Rs 13 per share, and the record date for this payout will be 8th November 2021.