Q2 2025 Coforge Ltd Earnings Call Transcript
Key Points
- Coforge Ltd (BOM:532541) reported a strong sequential revenue growth of 26.8% in US dollar terms for Q2 FY 2025.
- The company's organic business grew by 6.3% sequentially, while the Cigniti business grew by 6.1%, showcasing robust performance across both segments.
- EBITDA margin for the quarter improved to 15.8%, reflecting a year-on-year growth of 37.6%.
- The order intake for the quarter was USD 516 million, with a significant increase in the next 12 months signed order book by 40% year-over-year.
- Coforge Ltd (BOM:532541) has successfully integrated Cigniti, with synergies exceeding expectations and a target to achieve an 18% EBITDA margin for Cigniti by the end of the financial year.
- The organic EBITDA margin for the quarter declined by 126 bps over the previous quarter, impacted by wage hikes.
- Acquisition and integration-related expenses had a 2.3% impact on profitability, which is expected to normalize in coming quarters.
- The company faces potential headwinds from ESOP costs, expected to increase by 180 to 200 bps per quarter for the next two quarters.
- There are concerns about the durability of revenues from GCCs, as initial mandates are time-bound and may not sustain long-term.
- Despite strong performance, the macroeconomic environment remains uncertain, particularly in the banking sector, due to geopolitical events and high inflation.
Ladies and gentlemen, good day and welcome to the Coforge Limited Q2 FY 2025 earnings conference call. (Operator Instructions) And this conference is being recorded.
We have with us today from the management team, Mr. Sudhir Singh, CEO; Mr. John Speight, Chief Customer Success Officer; and Mr. Saurabh Goel, CFO. We will begin the call with opening remarks from the management team, and post that, we will open the floor for questions.
Before we begin, please note that some of the statements made in today's discussions relating to the future should be construed as forward-looking statements and may involve risks and uncertainties. Please refer to the disclaimer to this effect in the company's Q2 FY 2025 earnings press release.
With that, I now hand the call over Mr. Sudhir Singh. Over to you, sir.
Thank you, Imba. Ladies and gentlemen, thank you very much for joining us today as we share our quarter two fiscal year '25 performance and the business outlook going
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