Coforge Shares Fall Even After Key AI Acquisition

Shares of Coforge are falling on Monday's trade even after the company announced a major acquisition of US-based AI firm Encora for a total consideration of $2.25 billion.

The stock opened at Rs 1,711 but has since retreated to Rs 1,642 levels, accounting for fall of almost 2%. This comes despite a slew of positive brokerages notes in light of the company's acquisition of Encora.

Over the weekend, Coforge announced the acquisition of Encora, a US-based artificial intelligence and digital engineering firm for an enterprise value of $2.35 billion, or around Rs 21,138 crore.

The deal will be funded entirely through a combination of a share swap and an equity raise, marking a bold strategic bet by Coforge to reposition itself as an AI-led technology services player rather than a traditional outsourcing firm.

Under the terms of the transaction, Coforge will issue equity shares worth $1.89 billion (around Rs 17,032 crore) to Encora’s shareholders through a preferential allotment. The shares will be issued at Rs 1,815 apiece, representing a premium of 8.5% to Coforge’s previous closing price.

At $2.35 billion, the Coforge–Encora transaction ranks among the largest acquisitions ever by an Indian IT services company, and is significantly bigger than any of Coforge’s previous deals.

It didn't take long for brokerages the hail the move as revolutionary for Coforge, with some even calling it the best step for the company.

The likes of Dolat Capital, Morgan Stanley and Jefferies maintained buy calls on the counter. But the stock remains under pressure.

This marks the continuation of a period of paid for Coforge, whose shares have corrected as much as 82% since the start of 2025.