Coforge has received internal guidance against proceeding with its proposed Qualified Institutional Placement (QIP), according to recent developments. An executive within the company has recommended that the IT services firm should not move forward with the equity fundraising proposal at this time.

Executive Recommendation Details

The advisory against the QIP comes from within Coforge's leadership, though the specific reasoning behind this recommendation has not been detailed in available information. This internal guidance suggests there may be strategic, market-related, or timing considerations that make the current QIP proposal less favorable for the company.

Understanding QIP Implications

Qualified Institutional Placements serve as an important capital-raising mechanism for listed companies, allowing them to issue equity shares to qualified institutional buyers without going through the traditional public offering route. The recommendation against proceeding with such a placement indicates careful evaluation of current market conditions and the company's capital requirements.

Strategic Considerations

The executive's advice reflects internal assessment of various factors that could impact the success or desirability of the proposed equity issuance. Companies typically consider market timing, valuation concerns, and alternative funding options when evaluating QIP proposals.

This development highlights the importance of strategic decision-making in corporate finance, where internal expertise plays a crucial role in determining the most appropriate timing and structure for capital-raising activities.

Coforge Limited announced its unaudited financial results for the quarter and nine months ended December 31, 2025, demonstrating strong operational performance across multiple business segments. The IT services company reported significant growth in revenue and maintained healthy profitability despite facing some exceptional charges during the quarter.

Financial Performance Overview

The company's consolidated financial results showed robust growth momentum with total income reaching ₹42,020.00 million for Q3FY26. Revenue from operations stood at ₹41,881.00 million, marking a substantial 28.50% increase from ₹32,581.00 million reported in the corresponding quarter of the previous year.

Segment-wise Revenue Performance

Coforge's geographical diversification strategy continued to yield positive results across all major markets. The Americas region remained the largest contributor, generating ₹23,773.00 million in revenue for Q3FY26, compared to ₹18,574.00 million in Q3FY25.

Exceptional Items and Strategic Developments

The quarter included exceptional items totaling ₹1,476.00 million, primarily related to two significant developments. The company recognized ₹1,179.00 million as impact from the newly notified Labour Codes by the Government of India, which affected gratuity and leave liabilities. Additionally, ₹135.00 million was provisioned for legal and professional expenses related to the proposed Encora acquisition.

Major Acquisition Announcement

During the quarter, the Board approved a significant acquisition agreement for Encora US Holdco, Inc. and Encora Holdings Ltd. for an enterprise value of $2.35 billion. The transaction structure includes $1.89 billion through share swap arrangement and the balance through term loans. The share swap involves issuing 9,37,96,508 fully paid-up equity shares at ₹1,815.91 per share, totaling ₹170,326.00 million in consideration.

Dividend Declaration and Corporate Actions

The Board declared a third interim dividend of ₹4.00 per equity share for FY26, with January 31, 2026 fixed as the record date. The dividend payment will be completed within 30 days of declaration. The company had previously implemented a share subdivision in March 2025, splitting each ₹10 share into five ₹2 shares, with all earnings per share figures adjusted accordingly.

Earnings Per Share and Share Capital

Basic earnings per share for continuing operations stood at ₹7.45 for Q3FY26, compared to ₹6.37 in Q3FY25. The paid-up equity share capital increased to ₹670.00 million from ₹669.00 million, reflecting the exercise of employee stock options during the quarter. A total of 445,748 options were exercised while 374,839 options lapsed, leaving 8,250,172 options outstanding as of December 31, 2025.