Coforge slides 7% as over 7 million equity shares change hands on bourses

According to reports, Barings Private Equity was looking to sell part of its 40 per cent stake in Coforge via block deals

Shares of information technology firm Coforge slumped 6.7 per cent to Rs 4,039 apiece on the BSE in Monday's intra-day trade after 7.18 million equity shares, or nearly 10 per cent of total equity, changed hands on the BSE and NSE in early deals. On the National Stock Exchange (NSE), the stock hit an intra-day low of Rs 4,037.

At 9:46 AM, Coforge was quoting 6 per cent lower at Rs 4,070 per share on the BSE. In comparison, the S&P BSE Sensex was down 0.23 per cent.

According to a Business Standard report, Barings Private Equity was looking to sell part of its 40 per cent stake in Coforge via block deals. The shares offered are worth Rs 1,300 crore, with a greenshoe option of equivalent value, taking the total deal size to Rs 2,600 crore. READ MORE

Meanwhile, the IT firm announced earlier today that it has entered into a partnership with Denodo, a leading data integration, management and delivery platform, to enable banks and other financial organizations to engage in agile modernization projects without affecting daily operations.

Under the partnership, Denodo will bring its logical data integration and data management approach, powered by data virtualization, while Coforge will bring its design and implementation expertise at BFSI clients, enabling companies to overcome challenges like security, compliance, systemic risks, downtime, and data migration quality.

"This forward-thinking alliance will enable us to better address the needs of our clients, providing them with easier access to vital data sources and greater flexibility in data virtualization efforts. We believe the partnership will bring together Denodo's fine technical expertise and Coforge's deep domain driven design thinking and implementation prowess," said Deepak Khetpal, executive vice president and global head of data and analytics, Coforge.

In Q3FY23, the mid-tier IT services firm reported a 24.2 per cent year-on-year (YoY) rise in net profit at Rs 228.20 crore. On a sequential basis, the profit increased 13.5 per cent. Revenue for the quarter stood at Rs 2,055.80 crore, up 24 per cent YoY and 5 per cent QoQ. 

It had upgraded its FY23 annual revenue growth guidance to 22 per cent in constant currency terms, and had reaffirmed its adjusted Ebitda annual margin guidance, which is 18.5 per cent and 19.0 per cent for FY23. 

Global brokerage Nomura recently initiated coverage on the company with a 'Buy' rating and a target of Rs 5,050.

"A rejuvenated and stable management team with strong execution and a deepening focus on existing businesses while incubating new verticals, alongside the realignment of Go-To-Market (GTM), reinvigorating sales engine with strong incentive structures and a focus on M&A to bolster capability have been some key factors behind Coforge's strong growth and re-rating. We believe Coforge will continue to outperform with 25 per cent EPS CAGR over FY23-25F," it said in its report dated February 7.