COFORGE - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 05 Nov 25, 7:43 am

Fundamental Rating: 3.7

📈 Positive

• 📊 Quarterly PAT growth of 44.8% shows strong earnings momentum and operational efficiency.
• 📈 DII holding increased by 2.55%, indicating rising domestic institutional confidence.
• 📉 Low debt-to-equity ratio of 0.08 ensures financial flexibility and low leverage risk.
• 📈 MACD at 29.4 and RSI at 61.6 reflect bullish technical momentum.
• 📈 Trading above DMA50 and DMA200 (₹1,729 and ₹1,666), confirming upward trend.

⚠️ Limitation

• 📉 Very high P/E of 85.2 vs industry average of 29.4 suggests significant overvaluation.
• 📉 Negative PEG ratio (-11.6) implies valuation is not supported by sustainable growth.
• 📉 ROE (11.3%) and ROCE (13.9%) are modest for a tech company, indicating room for improvement.
• 📉 EPS of ₹20.9 is low relative to price, limiting valuation justification.

📰 Company Negative News

• 📉 FII holding declined by 3.33%, showing reduced foreign investor confidence.
• 📉 Volume below 1-week average may reflect short-term cooling in investor interest.

🌟 Company Positive News

• 📈 Quarterly PAT doubled from ₹151 Cr. to ₹332 Cr., signaling strong operational rebound.
• 📈 52-week performance up 72.3%, showing strong price appreciation and investor optimism.

💻 Industry

• 💻 COFORGE operates in the IT services and digital transformation space, serving BFSI, travel, and healthcare sectors.
• 📊 Industry P/E of 29.4 reflects moderate growth expectations and competitive pricing.

🧭 Conclusion

• 📌 Suggested entry zone: ₹1,700–₹1,740, near DMA50 for better margin of safety.
• 🕰️ Long-term holding viable for growth-focused investors, but valuation and ROE should be monitored.
• ⚖️ Watch for earnings consistency and foreign investor sentiment before aggressive accumulation.