Shares of IT major Coforge gained over 2% to their day's high of Rs 1,499 on the BSE on Wednesday, after the company’s management issued robust guidance of $5 billion in revenue by FY30 during its investor day on June 16.
Coforge said this implies a revenue CAGR of around 19% between FY26 and FY30, driven by organic growth of nearly 15% over the same period. The company expects organic growth to be supported by deeper engagement with key accounts, scaling up strategic growth bets and partner-led opportunities. Management also views AI as a growth accelerator rather than a disruption risk, saying it is creating new demand pools.
What are analysts saying?
Nomura has reiterated its Buy rating on Coforge with a target price of Rs 2,100, implying an upside potential of 43.3%. The brokerage said Coforge is targeting $5 billion in revenue by FY30, supported by what it sees as significant tailwinds from artificial intelligence.
Nomura noted that AI has become central to Coforge's delivery organisation, with offerings ranging from AI-assisted engineering to AI-led delivery through human-and-agent "Mod Squads". The company has also shifted towards a Forward Deployed Engineer (FDE) and Mod Squad-led operating model, revamped employee career tracks around AI capabilities, and is leveraging its Coforge One AI platform as a key differentiator.
Nuvama has maintained its Buy rating on Coforge with a target price of Rs 2,200, implying an upside of 50% from current market levels. The brokerage noted that Coforge's order book has expanded to $1.75 billion, about 2.4 times FY22 levels, with healthcare and public sector verticals expected to support large deal momentum in FY27. Nuvama also pointed out that more than 75% of the company's AI pilots have moved into production, aided by its "ModSquad" human-agent hybrid delivery model. The brokerage remains constructive on Coforge's growth outlook, citing industry-leading expansion, a stronger focus on margins and cash flows, and meaningful progress in developing AI-led solutions that could provide a competitive advantage.
JM Financial has maintained its Add rating on Coforge with a target price of Rs 1,600, implying an upside potential of 9.2%. The brokerage said investors should closely monitor the integration of the Encora acquisition and the company's ability to improve cash flow conversion going forward. It noted that the stock is currently valued at around 21x FY28E consensus EPS.
On the AI opportunity, JM Financial highlighted management's view that demand is likely to emerge across multiple service lines, including digital product engineering, data and analytics, cloud modernisation, cybersecurity, advisory services and the development of custom agentic solutions. Management also indicated that AI-led operations could deliver 35-50% efficiency gains, supporting productivity improvements and creating new growth opportunities across client engagements.
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Coforge share price performance
Coforge shares have declined 20% in the last six months and are down 11% since the start of the year.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
