Coforge Stock Surges Over 7% Following 1:5 Split and Acquisition News

Coforge's share price surged over 7% in early trading on Wednesday following the IT firm's announcement of board approval for a stock split and two acquisitions. The company's shares climbed as much as 7.59% to reach ₹7,751.60 per share on the BSE.

At 9:25 AM, Coforge share price was up 7.39%, trading at ₹7,736.50 per share on the BSE.

During its board meeting on March 4, 2025, Coforge's Board of Directors approved two key proposals—one for the sub-division of its equity shares (stock split) and the other for the acquisition of two companies.

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Coforge Stock Split

The company confirmed that its board approved a stock split in a 1:5 ratio. This means each equity share with a face value of ₹10 will be split into five shares with a face value of ₹2 each.

"...the Board of Directors at their meeting held on March 04, 2025, have considered and approved the alteration in the equity share capital of the Company by sub-division / split of existing equity shares of face value of ₹10 each, fully paid-up into 33,43,65,495 equity shares of face value of ₹2 each, fully paid-up," Coforge stated on March 5.

The company noted that the record date for the stock split will be announced later.

Explaining the rationale behind the move, Coforge stated that the objective was to improve liquidity in its shares and make them more accessible to retail investors by lowering the entry price. This is expected to expand the company's shareholder base.

The proposed alteration in the Capital Clause of the Memorandum of Association, resulting from the stock split, is subject to shareholder approval.

Rythmos Inc Acquisition

The board also sanctioned the acquisition of a full 100% stake in IT services firm Rythmos Transaction. The deal includes an upfront cash consideration of $30 million, along with additional payments in two phases, contingent on meeting specific milestones.

Coforge anticipates completing this transaction by March 31, 2025.

TMLabs Pty Ltd Acquisition

Additionally, Coforge announced the acquisition of a 100% stake in TMLabs Pty Ltd through its wholly owned step-down subsidiary, Coforge Technologies Australia Pty Ltd. The deal includes an initial upfront payment of AUD 20 million, with further payouts linked to revenue and EBITDA performance targets for FY26 and FY27.

The transaction is also expected to conclude by March 31, 2025.